Bitcoin

vimothy

yurp
unfortunately that is a problem. again, you're talking about fixing the total supply of liquidity for all time. it doesn't matter how small you can divide it. its still the same quantity of liquidity. for eg, if 100 bitcoins (or whatever) is not enough to meet total demand (think about debt contracts fixed in nominal terms), then dividing those 100 bitcoin by a billion won't help, because you'll still have 100 bitcoin.
 
unfortunately that is a problem. again, you're talking about fixing the total supply of liquidity for all time. it doesn't matter how small you can divide it. its still the same quantity of liquidity. for eg, if 100 bitcoins (or whatever) is not enough to meet total demand (think about debt contracts fixed in nominal terms), then dividing those 100 bitcoin by a billion won't help, because you'll still have 100 bitcoin.

Don't be doing debt contracts or derivatives of debt contracts reliant on fractional reserves then, that's what's fucking things up. Save and invest instead. It's debt contract that feed wars, when governments both borrow and print and devalue money to buy tanks, miles of barbed wire, munitions. Nature doesn't do debt, it's a human aberration. Illusory wealth creation. Debt brings economies down, not demand.

How does humanity cope with only 510.1 million km² of land to live on? No matter how many cities you build, there are still only 510.1 million km² to live on.
 
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john eden

male pale and stale
Once you grasp that Bitcoin is scarce, fungible and infinitely divisible, and that if you own one of 21 million bitcoins today, in 50 years, when global trade uses it for every transaction (which is not impossible, bitcoin really lends itself to that), that same bitcoin will be worth 1/21 millionth of activity worth maybe $50 trillion, or about $2.4m per BTC. You could buy a lot of good quality CD players with that.

It's the Internet of money, nothing less and much more.

It could also end up being the Betamax of the Internet of money, surely?
 

vimothy

yurp
so the solution is to do away with borrowing and lending (and therefore saving and investment, btw)? doesnt seem too plausible
 
so the solution is to do away with borrowing and lending (and therefore saving and investment, btw)? doesnt seem too plausible

lend what is saved to invest, not some fantasy multiple of what is saved. like in days of yore. as value of bitcoin increases, value of savings increases, ability to lend increases. A closer coupling between wealth and lending. The rich lend, the borrower borrows to invest and build wealth rather than consume.

OR borrow dollars secured by bitcoin holdings. Otherwise, don't borrow.

Lending used to be about investment, not consumption, remember?
"Debt‐fueled mass consumption is as much a normal part of capitalism as asphyxiation is a normal part of respiration”


The intoxication of easy money via debt fuels useless consumption, high time preference, I'll have my marshmallow now not two tomorrow. That's what's hurting the environment, not bitcoin mining.
 
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vimothy

yurp
then we're back to debt contracts. if I lend you 100 bitcoin to buy a house, you have a nominal liability denominated in bitcoin. since the supply of bitcoin is fixed, as the demand for bitcoin increases, so too does its real value. Now 100 bitcoin buys you two houses, so the real value of what you owe has doubled.
 
then we're back to debt contracts. if I lend you 100 bitcoin to buy a house, you have a nominal liability denominated in bitcoin. since the supply of bitcoin is fixed, as the demand for bitcoin increases, so too does its real value. Now 100 bitcoin buys you two houses, so the real value of what you owe has doubled.

And thus the real value of a house is revealed

Who in their right mind would borrow more than they could easily afford to buy a house?
Funny how the average price of a house increases with availability of credit. Inflation caused directly by debt, but outrunning affordability,

FTB-earnings.png
 
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vimothy

yurp
just because the financial system is highly dysfunctional doesnt mean bitcoin is a good idea. what you're proposing is basically impossible for any reasonable-sized economy where the future is unknown and firms are cash-flow constrained
 
only the nominal value of the house has changed (due to deflation, it now costs 50 bitcoin), what has increased is the real value of the debt

The buyer chose poorly. The market will find a price for houses buyers are willing to pay, given the risk of debt. It's only a problem if you want to move and haven't increased the value of the house by developing lush gardens, ornate cornicing and a geothermal bitcoin mining operation. So increase the nominal value of the house, by investing in it. Presumably buyer has been paying off that debt contract in the meantime - or were they just borrowing it to flip it, make a quick profit? Now there's a pyramid scheme relying on the greater fool: the current year British or Bay Area property market.
 
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vimothy

yurp
the problem is that you now owe twice as much as you borrowed, irrespective of whether you want to move or not.
 

vimothy

yurp
how is that nonsense? If I borrow 100 units of currency so that I owe 100 units back, and a deflation occurs in which the currency doubles in value, then the real value of my debt has doubled.
 

vimothy

yurp
the house thing is only an example. the real issue is that in a deflationary episode (which bitcoin has no way to prevent, bc its supply is fixed), the real level of debt will explode, leading to defaults, bank failures and economic chaos.
 

kevinoak

Active member
I would like suggest you to gain complete knowledge about cryptocurrency before trading. You need to decide which coins will be best and trading exchange and need to decide about time to invest. The main rule in crypto - is not to make impulsive decisions.
 
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Bitcoin update. The block reward is due to halve from 50 bitcoin to 25 in two weeks' time. This has consequences.

New stock-to-flow cross asset model predicts phase transition with next halving and $288,000 valuation between 2020 and 2024 (it's about $8,700 today)

 
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