DublinHead54
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It is simply factually incorrect to say that the Bitcoin code base cannot be changed.
Bitcoin in a hyperbolic bubble
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It is simply factually incorrect to say that the Bitcoin code base cannot be changed.
time to plan
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The price of 1 bitcoin is 1 bitcoin. Who cares what it is priced in terms of trash fiat currency? All we need is for the sheeple to demand to be paid in bitcoin and for goods and services to be priced in bitcoin, because that's how actual money works.
Duke of Marmalade
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Don't know whether you are making a serious point or not, as you are new to the debate.The price of 1 bitcoin is 1 bitcoin. Who cares what it is priced in terms of trash fiat currency? All we need is for the sheeple to demand to be paid in bitcoin and for goods and services to be priced in bitcoin, because that's how actual money works.
Since you are addressing me let me agree full heartedly with your definition of "actual money" and by any standard bitcoin fails on all fronts.
You didn't take to listening to that McW podcast then? The one about "What is money"?
According to McW, most economists don't know what money is.
Quite a staggering claim one would have thought? Nonetheless, one I would trend to agree with.
time to plan
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I'm just having a giggle at the expense of the Tulipmongers.
Duke of Marmalade
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Wolfie you didn't provide a link. But following this post I decided to give it a go. I don't know if I will ever be able to forgive you.
What a loada self indulgent BS. I should have stopped early doors when we had the most sensible quote of the whole podcast - Lonergan's daughter describes money as "it's what you use to pay for things". Which rules out bitcoin at least in its current state.
McW is fond of telling us how ignorant the majority of economists are; I presume he counts himself amongst the minority who do understand it.
The debate on QE was so infantile that I think they knew that but were feeding the fan base - QE bad.
As for bitcoin they truly gushed at how each bitcoin can be traced back through the blockchain to its birth. Even @tecate doesn't make a big deal of this.
And what about "money is created by the State and so we are all equally entitled to it"? which I think even Lenin would have baulked at.
The one interesting area which Lonergan did raise was that CBs seem to have displaced the primacy of the markets. It was Mrs T who said you can't buck the market, but I really can't understand how the market for 30 year fixed € interest rates is around 0.5%. How does that make sense to anybody? - seems the CB are calling the tune like never before. That is not necessarily a bad thing especially for those of a leftist outlook who generally distrust the markets.
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Have at it - as this unfolds over the longer run, the expense will be all yours.
Is QE good then and if so, for whom?
I don't because I tend to agree with Ed Snowden on the subject - privacy is important and bitcoin should be updated accordingly. That said, its been educational watching main stream media write polar opposite crap - trying to give bitcoin a kicking from both sides. We've had multiple 'bitcoin is the doings of criminality because it's untraceable' nonsense which no-one who has spent any time on bitcoin believes. No bitcoiner has ever claimed bitcoin to be untraceable, quite the opposite.
Then the ransomware $ turns up and they're publishing the opposite nonsense - look, these guys got it wrong - bitcoin isn't untraceable (the narrative from the very same media - not from anyone else). So no Duke - I don't make a big deal of this - but MSM does.
Finally, that monopoly is breaking.
Apologies, I wasn't endorsing the whole podcast. I generally listen to McW for his guest contributions (hit and miss) rather than his own insights which, while sometimes interesting and engaging, have been regurgitated endlessly now.
McW has been avoiding the whole bitcoin debate for sometime and any references to it he astutely sits on the fence. However, with the Lordships of the CB's talking more frequently about it he is being slowly dragged into the debate, albeit making no definitive assertion about it.
However, the question "what is money?" arose. My own definition preference is economic historian Niall Ferguson, money is "trust inscribed".
My own definition is that money is a form of communication that transmits and transfers value between humans. The transfer of that value occurring by way of currency.
Whatever it is, it is clear to me beyond the McW show and further afield, the definition of what money actually is quite uncertain. Being limited in general terms to banknotes and coins, bank balances, value of property and shares etc. All of which is money, but it only defines money limited in terms of central bank issued currency. All other forms of money, or the prospect of using any other form of money, are to be discounted. That is a credit to the inherent trust within the fiat system, a problem arises when that trust starts to ebb.
As Ferguson attests, such a form of communication needs to have trust inscribed for it to have, and sustain, value.
According to him, it doesn't matter if it is in clay tablets (as used in ancient Mesopotamia), seashells, silver, gold, or banknotes as long as the bearer and recipient of the currency are agreeable that is represents the value inscribed in it.
Exactly the point, if it starts to make little sense, then perhaps all is not well?
Duke of Marmalade
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@WolfeTone I don't see any difficulty with a definition of what is "money". Lonergan's daughter puts it very well "it is what you use to pay for things". Now perhaps what most economists except DMcW find difficult to understand is what makes for a good form of money. @tecate has in the past given us a list of desirable attributes - divisibility, durability etc.
The attribute that needs most critical consideration is "store of value". I prefer the term "stable purchasing power in the medium term". In fact a good long term store of value is not helpful as a modern medium of exchange.
Fiat money is a form of debt from society which bridges the lack of coincidence of wants needed in a barter economy. The debt aspect is fairly key. For example, the fact that a young couple are heavily mortgaged is a big underpin to them wanting to continue working for money.
Now stable purchasing power of something with no intrinsic value does derive from society acceptance. The stability and acceptance of fiat in developed economies is underpinned by many things including Central Bank oversight.
Bitcoin is completely devoid of these underpinnings and, as even its devotees concede as a non trivial risk, could go BOHA very quickly.
The attribute that needs most critical consideration is "store of value". I prefer the term "stable purchasing power in the medium term". In fact a good long term store of value is not helpful as a modern medium of exchange.
Fiat money is a form of debt from society which bridges the lack of coincidence of wants needed in a barter economy. The debt aspect is fairly key. For example, the fact that a young couple are heavily mortgaged is a big underpin to them wanting to continue working for money.
Now stable purchasing power of something with no intrinsic value does derive from society acceptance. The stability and acceptance of fiat in developed economies is underpinned by many things including Central Bank oversight.
Bitcoin is completely devoid of these underpinnings and, as even its devotees concede as a non trivial risk, could go BOHA very quickly.
Yes, but that is more its functionality that what it actually is, which is the transmission and transfer of value between human beings based on trust.
Ferguson highlights this with the use of clay tablets 4,000 BC which conferred obligations on individual to provide goods and services on the bearer of the clay tablets. The clay tablets themselves easily imitated. What was not easily imitated was what was written on them. Being 4,000 BC it doesn't take a genius to figure that literacy was most probably the preserve of high priests and nobles of the era. And if they could read and write what was on the tablets, who could dispute their word?
For example, the scriptures of the Bible have endured to this day. If it is written, then so it shall be...trust.
The same principle exists today with CB monetary system. Fiat has no intrinsic value other than the trust applied to it by the population by virtue what the high priests and nobles of the CB say is to be trusted.
And in this centralised command banking economy how can any sense be made of 30yr interest rates of 0.5%?
Thanks for acknowledging bitcoin as a long term store of value. There is some merit to what you say - on the basis of Greshams Law - i.e. people want to offload crap coin and hold back hard money. Now if that crap coin can be managed to a point where it doesn't get too wayward (with the managers of that crap coin aware that if they mess up their crap coin will cease to be used) - whilst hard money is used for savings - I can see that as a win for society. As I've mentioned many times - this is not a black/white - binary scenario. Both can co-exist and choice/competition is healthy.
This is very interesting. So you think that big government is seeing to it that the system is designed such that Joe/Josephine Soap are up to their tonsils in debt - for their own good? So that they will be productive little foot soldiers because what's most important is that we feed the Keynesian Economy Monster? Can they not be trusted to make this decision for themselves? Would they not want to make that decision for themselves? I'm sure if you pour over other posts in other sections of this board, you'll see advice from Brendan and others to pay off the mortgage. Is that bad advice?
Isn't it also true that the current model needs this - because growth has to be achieved regardless of the cost? i.e. the stress and quality of life issues it may cause by encouraging people to be up to their eyeballs in debt? Aside from that, the irony when bitcoin is being tarred and feathered on environmental grounds when the real culprit is the current economic model that encourages people to consume at all costs - it doesn't matter what - just consume and keep the economy fed.
How's that oversight going in Lebanon right now? You know I can list off a plethora of other examples - past and present - so for expediency, I won't bother.
That's incorrect - quite the opposite. Bitcoin has a monetary policy and the beauty of it is that nobody can screw with it and it's totally transparent. Furthermore, there's little in the way of stealth tax via inflation. So when ordinary people work hard and are productive, they don't have to become advanced investors/traders to try and get ahead of that nonsense which otherwise erodes and undoes all of their hard work.
Most proponents of BTC are aware of the difficulty in trying to achieve adoption for something that is technical, new and faces fierce opposition from most corners of the conventional world of finance/government/banking, etc. That's where most don't get too far ahead of themselves - not on the basis of the design or monetary policy of bitcoin.
Duke of Marmalade
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@WolfeTone Well "trust" is central to the clay tablets and to modern fiat. But it was not always enough. Sea shells, gold, silver etc. were not based on trust - they had intrinsic value. Under the gold standard, other than trusting "promise to pay the bearer" money essentially had intrinsic value. Modern fiat is of the form "trust your Central Bank/government to do its best to maintain the stability of the purchasing power".
The huge weakness of bitcoin/crypto is in fact what the cultists call its strength - it is trustless. There is no central authority to trust to maintain its stability. Yes of course we can "trust" the protocol to provide a finite supply but with no intrinsic value that is useless for building confidence in the stability of its purchasing power, as we witness on a daily basis.
The huge weakness of bitcoin/crypto is in fact what the cultists call its strength - it is trustless. There is no central authority to trust to maintain its stability. Yes of course we can "trust" the protocol to provide a finite supply but with no intrinsic value that is useless for building confidence in the stability of its purchasing power, as we witness on a daily basis.
There were plenty of currencies based around things that didn't have intrinsic value. Rai stones as an example - yet they were treated as a store of value.
That's fiat's Achilles Heel.
'Cult' jibes from a committed wahabist. Yes, bitcoin is volatile and will remain volatile whilst it goes through the adoption curve. As has been pointed out to you, gold has seen some volatility of the same proportions in the past. Therefore, it isn't necessarily so that a lack of intrinsic value is at the heart of the question of btc's volatility.
DublinHead54
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Oh really?
Sichuan Mining Farms Begin to Shut Down — Seven-Day Stats Show Bitcoin’s Hashrate Plummeting – Bitcoin News
Bitcoin's hashrate has been steadily falling since June 14 and after Sichuan miners were told to prepare operation shutdowns.
DazedInPontoon
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In 7 days, the mining difficulty will adjust. It's currently on schedule to reduce by 18.8%. OK.
Trusting them to do their best to maintain the stability of purchasing power is one thing, trusting them to succeed is another. This is far from a strength, this is the inherent weakness. Constant tampering with rules and policies to suit a perspective of certain ideology (pump asset prices/trickle down effect) is a recipe for debasement.
It's because of the lack of central authority interfering, changing the rules, changing the parameters, the policy etc that bitcoin gains strength.
Indeed it will - it's a beautiful thing. For an age, we had claims of bitcoin being subject to Chinese control. Clearly that was wayward. There's no way that the Chinese would push out miners if their very presence presented them with such control over the network. Had there been an actual attack on the network, it would have failed.
DublinHead54
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Tecate, I understand you like to pick and choose what points to answer. But you have to see how wrong you were by claiming the chinese government could not stop miners in china. Every reputable Crypto news source has been reporting on it, and it is evident in the hashrate.
Its ok to admit that changes have happened. It is widely accepted in the community that the Chinese government action is different this time.
For other readers of this thread, I actually think the China crackdown is good as it decreases centralization of mining and reduces the chance of a 51% attack which is bringing the network back towards the original plan. However, it was important to highlight Tecates claim that Bitcoin can operate autonomously without the Chinese government being able to mobilize against them, as simply wrong.
The hashrate is falling: https://decrypt.co/74075/bitcoin-hashrate-falls-17-overnight-after-china-mining-crackdown
China Miners relocating to Kazakstan (https://decrypt.co/74172/chinese-bitcoin-mining-firm-relocates-machines-kazakhstan)
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I think you may misconstrued @tecate point, above, about the Chinese government. I don't read it as being wrong. Actually, s/he is on the money as far as I can see.
The substantive point being moving against miners without letting cat out of the bag - am I to understand correctly bitcoin mining is on the uptake in North America and El Salvador for example?
Just to take that a step further Wolfie, there were previous discussions here in relation to two things relative to mining in China:
1. The possibility of a 51% attack
2. China implementing regulation - inclusive of a potential ban on mining/trading, etc.
In relation to the former, we've now seen that there was no earthly way that a 51% attack could have been carried out with a successful outcome for the CCP. If that were the case, there is no earthly way they would push miners out of China. That was pure FUD - and nothing more.
In relation to the latter, unless someone is telling me that bitcoin mining has been banned in the other 194 jurisdictions in the world, it's of no concern. It does provide short term upheaval - with miners moving abroad - and the costs associated with that (which would necessitate them to liquidate some btc from their treasuries).
Everyone has been aware since day 1 that the bitcoin project is completely at odds with the doings of authoritarian governments. China will always be concerned about anything that it can't control. That's why it tried to shut out the internet back in the day - and its why its shutting out bitcoin today. They're about to up the anti with their digital yuan project - something that will really allow them to have their citizenry by the short and curlies like never before. I'm sure they wouldn't want their minions being distracted by such a thing.
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