David McWilliams: "Bitcoin Betrayal"?

[DazedInPontoon]

It shows that nobody takes David seriously.

As ever, it's important that we can all rally around a common belief as a starting point.

 

[Paul O Mahoney]

They're mined with a transparent supply schedule that continually reduces every four years - with new supply coming to an end in 2140. That's set out clearly in the programmed rules of the cryptocurrency. There will never be more than 21 million Bitcoin.



So what?




It's "ONLY" a digital version? I can't help you if you don't see the significance Paul.




What was achieved in solving the double spend problem is highly regarded in cryptography as a breakthrough. Of course it builds on whats gone on before - things evolve. That's how innovation works. As regards it disappearing tomorrow and commerce not missing a beat - absolutely....just like the internet had it disappeared in 1995.



Those flaws can be improved upon...and that doesn't necessarily mean going to extremes and opting for one over another. Choice has never been a bad thing for society. Whilst flawed, you're talking about a mature system that has been afforded decades to evolve. The internet wasn't such an innovation in peoples lives in 1995.



I have no earthly idea what your point is with this. Feel free to explain it if you wish.



I have not seen anyone claim that Bitcoin will 'change the ills of the world' over the course of 5 years of discussion here.



So Bitcoin doesn't add value to you personally and so you now assume that everyone on the planet must have the same circumstances. That in no way is the case. You like rules and regulations - is it possible to have regulations that are just plain wrong? Is that ever possible? I'm not averse to regulation - but just in case anyone thinks regulation can only be good, that couldn't possibly be true. There are any amount of examples of bad regulation relative to money and finance that are not in the interest of the ordinary joe.
You've never felt the victim of financial censorship. That's great for you. That doesn't mean that it's not going on in the world right this second.
Digital currency is where this is headed and yes, we will have Central Bank Digital Currencies (CBDCs) but they are not in any way the same thing as Bitcoin.
Always the nefarious jibe yet multiple peer reviewed studies over the past few years have all shown Bitcoin to have less illicit use than fiat currency.



In no way will I stop saying that Brendan - because it's the truth. You cannot recreate Bitcoin with the very same security model. You could use the very same source code and it wouldn't match it because it wouldn't have the network security to keep it online. It would last all of five minutes. You're also conflating other digital assets with Bitcoin - which betrays a total lack of understanding as regards what they involve. They are not the same.
It's amazing that you're digging up this wayward FUD right now - I haven't heard that claim here since a few years ago already. I'll say the same now as i said then - spin up BurgessCoin or MarmaladeCoin - and come back and explain to us why nobody uses them - OR - if the point of the exercise is to demonstrate that Bitcoin isn't in any way unique, you can come along and explain why your new currencies have been ignored entirely.

Dude your gonna find it difficult to survive if you don't understand nuances, and frankly I'm beginning to think that you have an inability to debate "

You continue to " sell" the line but don't even understand that your analysis is incorrect on anything that proves that intangible ideas aren't assets.

You do remind me of a guy on YouTube who no matter what reasonable question on the virtues of Bitcoin that was posed , went on a rant with a heafty dose of conspiracy theory and like you name calling. He was in Singapore or Hong Kong and really was a bit nuts. Was that you?

You also " infer " the true sign of either lack of understanding or worse lying.

Bitcoin is a ponzi and a cult and despite your defensive position the truth will out, and you and your ilk will answer either to the legal system or a least yourselves, but I doubt the latter matters to ye.

Btw, the black tulip was the cause of tulip mania the first truly recorded scam which caused a lot of money to be lost by the entire economy of Holland, but during it " innovation was going to produce a black tulip" , and like Bitcoin everyone bought in expecting that it could be cultivated, but its impossible, bit like Bitcoin its "innovation " will suck people in bankrupt most, and the idea of its revolution will also be proven to be impossible .

 

[tecate]

@tecate would you have any concerns if bitcoin was the asset of choice for Ireland's upcoming generation's savings? Though I think you are on record as being "5% of portfolio" guy. A 5% hit to the nation's savings would not be total disaster.

I have always said 5% of portfolio sounds reasonable to me - and within that, I'd suggest that people dollar cost average (DCA) their way into that. I'll also add that what someone does or doesn't do is their decision. i.e. I believe in personal responsibility - grown ups make grown up decisions surrounding their own finances.

Dude your gonna find it difficult to survive if you don't understand nuances

If you haven't explained something in a way that someone understands what you mean, that's your failure. Although it wouldn't be much of a failure if you actually came back and explained what 'nuance' I haven't understood. But that's up to you.

and frankly I'm beginning to think that you have an inability to debate

I very much disagree and I'll turn that right back on you. As above and with this statement, you're playing the man and not the ball (the actual subject). That's your choice.

You do remind me of a guy on YouTube who no matter what reasonable question on the virtues of Bitcoin that was posed , went on a rant with a heafty dose of conspiracy theory and like you name calling. He was in Singapore or Hong Kong and really was a bit nuts. Was that you?

Again, how does this add to the discussion? What has this got to do with the discussion? You're practically saying that I engage in conspiracy theories. Please enlighten me as to which conspiracy theories I've put forward here? You call me nuts - the same sentiment back at you.

You also " infer " the true sign of either lack of understanding or worse lying.

Again, we have the personal attack. I'd have more respect for a piece of dog crap stuck to my shoe than a reprobate that comes on here claiming that I'm lying - and conveniently can't point to where I've lied. That same sentiment right back at you.

Bitcoin is a ponzi and a cult and despite your defensive position the truth will out, and you and your ilk will answer either to the legal system or a least yourselves, but I doubt the latter matters to ye.

If you think its a ponzi and a cult, that just betrays that you have no notion what you're talking about - albeit you're more than entitled to your opinion. As regards "I will answer to the legal system", what the hell are you talking about? As regards "answering to myself", for what? Expressing my opinion? JHC.

Btw, the black tulip was the cause of tulip mania the first truly recorded scam which caused a lot of money to be lost by the entire economy of Holland, but during it " innovation was going to produce a black tulip" , and like Bitcoin everyone bought in expecting that it could be cultivated, but its impossible, bit like Bitcoin its "innovation " will suck people in bankrupt most, and the idea of its revolution will also be proven to be impossible .

Do you want to explain why Tulipmania involved one single bubble and Bitcoin is on its 5th hype cycle? Why would anyone ever even consider it a second time round if it's such a ponzi? Hype cycles relative to new innovation/technology are nothing new.

Also on the 'sucking people in' nonsense, grown adults make their own decisions. They could buy tech stocks and lose 80%, buy the Japanese Yen and lose 35% or buy bitcoin at its peak and decide to sell it at a loss. All of those decisions are their own. Of course, a special place in hell is reserved for anything to do with crypto whereas the other items mentioned get a free pass.

 

[Brendan Burgess]

If you think its a ponzi and a cult, that just betrays that you have no notion what you're talking about

Hi tecate

You have to agree that it's a cult. A large group of people believing in something totally irrational and completely blind to any argument. A quasi-religious language.

I don't believe that it's a Ponzi scheme, because I don't think that there is fraud involved. Unless it was set up with the sole intention of defrauding people. As we don't know who started it, we don't really know for sure. But it looks like a genuine attempt to innovate that lost contact with its original purpose.

But it's similar to a Ponzi scheme in that it depends on a "greater fool" paying more for the BOHA than you paid for it. And those in at the end will lose everything.

Brendan

 

[Paul O Mahoney]

I have always said 5% of portfolio sounds reasonable to me - and within that, I'd suggest that people dollar cost average (DCA) their way into that. I'll also add that what someone does or doesn't do is their decision. i.e. I believe in personal responsibility - grown ups make grown up decisions surrounding their own finances.


If you haven't explained something in a way that someone understands what you mean, that's your failure. Although it wouldn't be much of a failure if you actually came back and explained what 'nuance' I haven't understood. But that's up to you.


I very much disagree and I'll turn that right back on you. As above and with this statement, you're playing the man and not the ball (the actual subject). That's your choice.



Again, how does this add to the discussion? What has this got to do with the discussion? You're practically saying that I engage in conspiracy theories. Please enlighten me as to which conspiracy theories I've put forward here? You call me nuts - the same sentiment back at you.


Again, we have the personal attack. I'd have more respect for a piece of dog crap stuck to my shoe than a reprobate that comes on here claiming that I'm lying - and conveniently can't point to where I've lied. That same sentiment right back at you.



If you think its a ponzi and a cult, that just betrays that you have no notion what you're talking about - albeit you're more than entitled to your opinion. As regards "I will answer to the legal system", what the hell are you talking about? As regards "answering to myself", for what? Expressing my opinion? JHC.


Do you want to explain why Tulipmania involved one single bubble and Bitcoin is on its 5th hype cycle? Why would anyone ever even consider it a second time round if it's such a ponzi? Hype cycles relative to new innovation/technology are nothing new.

Also on the 'sucking people in', nonsense, grown adults make their own decisions. They could buy tech stocks and lose 80%, buy the Japanese Yen and lose 35% or buy bitcoin at its peak and decide to sell it at a loss. All of those decisions are their own. Of course, a special place in hell is reserved for anything to do with crypto whereas the other items mentioned get a free pass.

Tulip Mania was a sequence of bubbles each one more devastating than the last.

Nature solved it , Bitcoin is unnatural so unnatural that its useless.

Finally from me, I admire your tenacity on defending something you believe in, but I do think that perhaps that tenacity would far more profitable than 1 Bitcoin.

 

[Brendan Burgess]

I admire your tenacity on defending something you believe in

+1

 

[CuriousGeorge11]

One of the main attractions of crypto is for gambling.

Online gambling is illegal is America but gambling with crypto is not illegal. That's a significant market

 

[tecate]

You have to agree that it's a cult. A large group of people believing in something totally irrational and completely blind to any argument. A quasi-religious language.

In no way do I have to agree with any such thing ( particularly given that in no way is that true). It's just the use of a disparaging term to tar and feather it. Precisely how you've presented that betrays your own bias on the subject. It being 'totally irrational' is your opinion - it's not one that I share. On the 'completely blind to any argument' suggestion, i disagree entirely. You are consistent in your view over a number of years that there can only be one outcome. I have always told you that I'm open to the notion that Bitcoin fails. The 'cult' view being 'blind to any argument' is yours in that instance. I could list off a whole host of drawbacks and criticisms I have mentioned here relative to Bitcoin or its ecosystem or of actors in the crypto space. Could you mention one positive trait of Bitcoin that you've identified - and disclosed here? Can you point to any post where you've been critical of the conventional monetary system?

My thesis on Bitcoin remains under constant review. If I'm to act in my own personal interests, it benefits me if I manage to discover something that indicates it's not going to continue to develop. None of that points to cult like behaviour. There are plenty of folks who are currently enthusiastic about Bitcoin who are more than happy to critique the digital currency or issues within the crypto sector.

However, there is a point you have missed relative to the tokenomics of crypto and how it relates to community. There is a way that marketing spend can be reduced in the future that implicates community and an element of user ownership through tokens. But again, all of that is pragmatic and doesn't involve religion or cult.

Tulip Mania was a sequence of bubbles each one more devastating than the last.

Nature solved it , Bitcoin is unnatural so unnatural that its useless.

Finally from me, I admire your tenacity on defending something you believe in, but I do think that perhaps that tenacity would far more profitable than 1 Bitcoin.

If you have a link showing the sequence of bubbles, I'd be keen to have a look at that. My understanding was that it was one bubble taking place over the course of 3 years but subject to what you come back with, I'm open to correction.

 

[Paul O Mahoney]

Read Anna Golgars book and Charles Mackay's, centuries apart but same message. Golgars book is a more nuanced view of bubbles and has the history of the tulip in it.

Neither mentions the black tulip, which is otherwise known as the broken tulip as it was cultivated but was the rarest colours and mix of and the alchemists, botanists etc sent for more samples as they thought they could create the ultimate " the black tulip" of course every bulb was then a potential and thus the bubble which reach its crescendo in the 3 years but had built up over 100 years, with peaks troughs but ultimately ruin.

 

[DazedInPontoon]

There are plenty of folks who are currently enthusiastic about Bitcoin who are more than happy to critique the digital currency or issues within the crypto sector.

On that note, I really enjoyed this recent interview with Nic Carter about his assesment of Bitcoin right now:

- YouTube

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www.youtube.com

 

[tecate]

On that note, I really enjoyed this recent interview with Nic Carter about his assesment of Bitcoin right now:

For sure. Probably not wise to put anyone on a pedestal but in terms of Carter's record so far, he's been a credible character in this space. He had spoken out about the dangers of algorithmic stablecoins ( and more specifically Terra/Luna) and about yield providers like Celsius.

 

[ThatNewGuy]

As we don't know who started it, we don't really know for sure. B

I subscribe to the theory of Hal Finney and David Kleinman as architects and engineers, with Craig Wright as general wrapper in trying to define their invention as "a thing".

I don't think "the thing" they created is a fraud - anything that people believe in can be an entity. A company is nothing more than a collection of people agreeing that a company exists and working to it's supposed purpose.

It's the latter part of that sentence though that I think Bitcoin is going to struggle with over the long term - it doesnt serve any external purpose other than being it's own "thing" people currently believe in. It doesnt solve any business problem or offer any services of its own like a company.

In my view the entire crypto space is currently people exploring every possible use for blockchain technology and hoping something sticks. They created a hammer and are looking for nails. I think eventually some nails will make themselves clear, but there's an exceptionally large base of purpose-less ideas being created and hyped at the moment that I think will eventually have a complete wipeout.

Until that happens, in the interim with a risk appetite and spare cash, there's quick bucks to be made...if you dont mind high risk of losing them also!

 

[Duke of Marmalade]

On that note, I really enjoyed this recent interview with Nic Carter about his assesment of Bitcoin right now:

- YouTube

Enjoy the videos and music that you love, upload original content and share it all with friends, family and the world on YouTube.

www.youtube.com

A very impressive and knowledgeable guy though I would question his assertion that the Glass Steagle Act of 1933 was in response to the dot.com bubble. Also an admission that on the eve of the invasion he said Russia wouldn't. He wasn't the only one but that and some subsequent comments about the futility of sanctions makes one wonder about his worldview and whether this colours his crypto view. Anyway I really enjoyed the interview. Some take-aways.
His analysis of the perilous situation of the conventional system and fiat is frightening and I am not really in a position to contradict him.
Excellent analysis of why we are having inflation which I totally agree with. It is not to do with the bloated money supply, it is caused by the contracting goods supply - the war, de-globalisation, climate change, energy crunch etc etc. - a reversal of the deflationary backdrop we are just emerging from. (aside: bitcoin doesn't address goods side supply issues, even in theory).

On the prognosis for bitcoin he sees the potential upside coming from "fiat will die off", "hyperinflation of 30% p.a. for a few years", "US default". It is not impossible and one understands how one would desperately want a bunker to protect from that. But wanting a bunker does not mean that one exists and it seems to me that Nic has indulged in wishful thinking. For sure bitcoin fills a lot of the requirements - fixed supply, decentralised, politically neutral - all the things in @tecate's credo. But it fails on the essential sine qua non. Nic calls it a "synthetic commodity" . Where is the "commodity"? In the words of a source which has undoubtedly applied some of the sharpest brains in the planet to the issue "bitcoin is utterly worthless."
Fantastic take on the miners. Procyclical. Rewards crashing, hash rate rising, go figure! Big problems looming in that space.
He certainly wasn't giving out any short term buy signals, though of course he still remains a long term believer.

 

[DazedInPontoon]

A very impressive and knowledgeable guy though I would question his assertion that the Glass Steagle Act of 1933 was in response to the dot.com bubble. Also an admission that on the eve of the invasion he said Russia wouldn't.

I didn't expect the Russian invasion either, but I didn't really know that much about the whole situation. I just figured Putin has historically generally been rational and this seemed irrational.

He wasn't the only one but that and some subsequent comments about the futility of sanctions makes one wonder about his worldview and whether this colours his crypto view.

Genuine question from me: are the sanctions working? because we're paying a hefty price for them ourselves it seems and how screwed are we going to be come winter without Russia energy?

I've also heard Russia are just selling more unrefined oil to India, who are refining it and selling it back to the Western world at a higher price, but I don't have a good source for this so not sure if it is true or not.

Anyway I really enjoyed the interview.

I'm glad the fact it was an interview between two cult members did not turn you off of it.

Some take-aways.
His analysis of the perilous situation of the conventional system and fiat is frightening and I am not really in a position to contradict him.
Excellent analysis of why we are having inflation which I totally agree with. It is not to do with the bloated money supply, it is caused by the contracting goods supply - the war, de-globalisation, climate change, energy crunch etc etc. - a reversal of the deflationary backdrop we are just emerging from. (aside: bitcoin doesn't address goods side supply issues, even in theory).

I figured it would be a combination of all reasons, including money supply, to one degree or another.

On the prognosis for bitcoin he sees the potential upside coming from "fiat well die off", "hyperinflation of 30% p.a. for a few years", "US default".

I think he specifically mentioned *lesser* fiat currencies dying off.

I hadn't realised what was going on with the Yen until he mentioned it, look at that drop off in the last year against dollar, and that's against a dollar that's at 8.6% inflation!

It is not impossible and one understands how one would desperately want a bunker to protect from that. But wanting a bunker does not mean that one exists and it seems to me that Nic has indulged in wishful thinking. For sure bitcoin fills a lot of the requirements - fixed supply, decentralised, politically neutral - all the things in @tecate's credo. But it fails on the essential sine qua non. Nic calls it a "synthetic commodity" . Where is the "commodity"? In the words of a source which has undoubtedly applied some of the sharpest brains in the planet to the issue "bitcoin is utterly worthless."
Fantastic take on the miners. Procyclical. Rewards crashing, hash rate rising, go figure! Big problems looming in that space.

The question is if enough of us collectively decide to use bitcoin as a bunker will it then be one? It's circular, as ever, and I don't expect by now I'll ever change your opinon on this. Subject theory of value and all that.

He certainly wasn't giving out any short term buy signals, though of course he still remains a long term believer.

Yup, I've probably been more bullish lately than I should have been. He still sees the Fed actions reversing by 4th quarter though, which isn't that far away.

(Another interesting note related to your previous comments about the under 35s choosing bitcoin, it seems Nic's father was a lifer in the "fiat system" including working at the world bank, and here's Nic - a hardcore bitcoiner. Similar to the situation with goldbug, no-bitcoiner Peter Schiff, whose son is a bitcoiner too.)

 

[Duke of Marmalade]

Further thoughts. I am actually with him in that I am surprised that the fall in crypto was not sharper against the backdrop of Celsius and Tera. Tether is the one to watch.

 

[DazedInPontoon]

Another crypto hedge fund Three Arrows Capital (3AC) bit the dust and filed for bankruptcy today it seems:

Crypto broker Voyager Digital issued 3AC with a default notice on Monday after it failed to make payments on a loan of 15,250 bitcoin (approximately $324 million) and $350 million worth of USDC, a stablecoin

I had never heard of this one.

Meanwhile Saylor and MicroStrategy announced they bought another 480BTC for $10m.

 

[Duke of Marmalade]

Meanwhile Saylor and MicroStrategy announced they bought another 480BTC for $10m.

I think that is extremely small beer for them and a rather blatant attempt to show confidence. It actually shows weakness if that is all they are prepared to put up. Better to have done nothing.

 

[DazedInPontoon]

Nah I think they've been making periodic small (by their standards) buys like this with their profits. The bigger buys were with their original treasury cash and when they issued bonds. (EDIT full history here: https://www.buybitcoinworldwide.com/microstrategy-statistics/)

He's said himself he doesn't believe he can time the market so he buys when he has new cash available to do so.

Weakness would have been selling.

 

[Duke of Marmalade]

Nah I think they've been making periodic small (by their standards) buys like this with their profits. The bigger buys were with their original treasury cash and when they issued bonds. (EDIT full history here: https://www.buybitcoinworldwide.com/microstrategy-statistics/)

He's said himself he doesn't believe he can time the market so he buys when he has new cash available to do so.

Weakness would have been selling.

Okay, so it is just a continuation of existing strategy. Doing it means nothing therefore, they had no choice as to stop the routine would have been a very negative signal.

 

[lff12]

As a Millennial, here's my 2c based on my social circle of educated mid- to high-earning tech workers.

No one talks about investments in general, nevermind bitcoin. The most that people manage to set up is their pension, and even at that it's usually just up to the company match and into the default fund.

The only times investments come up are 1) when to cash in RSUs, and 2) recently with inflation there's been talk of protecting the value of money (which usually ends quickly when they see that losing 8% purchasing power per annum may be better than losing 20% in the last 6 months on the stock market).

I've had more taxidrivers talk to me about bitcoin than peers.

Maybe since my circle earn more than the average Millennial, many of them can afford a deposit anyway so don't feel they need to risk it on crypto. The plural of anecdote isn't evidence and all that. But I do think that there is an element of McWilliams enjoying saying "I told you so".

Well! I did a year on contract with one of the smaller banks here about 8 years ago, and I recall one of my colleagues was mining bitcoin (might have had some investment in it, at the time it was around 1k or so). The guy had a background in general business, had been a bit of an entrepreneur and he was more interested in the mining side of things. I recall our boss getting very excited at the idea. Now this was 8 years ago, bear. Even though the price was lower, they still regarded it as a bit of a day at the races, but its a lot less if you blow 1 or 2k, compared to the vast sums people are prepared to put in now. The colleague was about 30 and my boss was I'd say around 40 at that time.

Not long before that, people were still punting on live currency trades. I blew through 200 dollars in 2 days on that myself, and counted it as a lesson well learned.

People do talk about the new thing, but crypto is hardly new. Even back then I recall people saying that really it would only be worth it if you had already bought in.