Bitcoin Forum

Silicon Valley VCs finally figured out the difference between Internet/Internet companies situation vs Bitcoin/bitcoin companies situation.
I find the following writing pretty remarkable:
https://www.usv.com/blog/fat-protocols

Basically, the author predicts that there is more value in bitcoin protocol/token than in companies derived from it, hence VCs are re-orienting themselves to invest DIRECTLY in tokens AND protocol, first and foremost, rather than derivative companies. First couple of funds already formed.
Hence, they will invest large sums in Bitcoin itself, resulting in bitcoin price rally that would be sustainable.

That is all talk and useless analysis as we have seen in the past. When Bitcoin's price rises we all see the "geniuses" writing anything to join the hype and the bandwagon. When the price drops, those "geniuses" will also be the first ones to write all the negative articles and blogs. Like gold, all of Bitcoin's value leans towards speculative value.

I agree that there is a rally but it is never sustainable. You should be aware that the margin trades made in Bitcoin is at the highest in the history of Bitcoin trading. That is not sustainable but it could last a long time.

I don't find it useless since they already instantiated two funds.
Lasting a long time=sustainable in my book. I don't know any other definition.
It is certainly not forever if this is what you are getting at. With that, I agree.

When they talk about it, they already bought, and it's never an endless supply of money, so sustainability is temporary at best.

When I mentioned "a long time" it means 2 or 3 years. That is not sustainable that is a bubble forming and getting ready to pop when the right time comes. I also mentioned that this is the highest ever amount of margin trading in Bitcoin. How can that can be ever sustainable in your book? In reading your retort, In my book we are close in getting to a stage of mania in the trading cycle.

We've already been in a sustainable uptrend for the latest 1.5 years. Not sure what you're talking about.

I think majority of VCs already have realized this that the bitcoin based companies can't return more than what they could have generated by investing in bitcoin or by buying bitcoin on early days.

Profit from bitcoin related business is only fractional compared to what they could have earned by directly buying bitcoin when price was around $100 per coin rather than investing in bitcoin startups during those time.

Many of them seems to already have invested into bitcoin directly and still doing same whenever they see cheaper bitcoin. We are already in steady growth this year.

We dont need any more reasons, this rally is 3 years in the making. Let's just enjoy the ride.

At the above linked blogs I wrote, pay attention to the following quote:


Bitcoin is becoming a reserve currency and conduit for everything in the ecosystem of blockchains and crypto-currrency.

Bitcoin doesn't actually have to scale to mass volume and instant transactions itself. The altcoins and payment  channels will do that. Bitcoin is the conduit for everything...

The reason for the price rise now (https://bitcointalk.org/index.php?topic=1663070.msg17172787#msg17172787).


Edit: Centralized scaling (which is an oxymoron) of Bitcoin can provide some limited amount of scaling. It won't scale out to Visa scale (https://bitcointalk.org/index.php?topic=1319681.msg17182298#msg17182298), but it will serve the function of BTC to become the reserve currency of crypto ecosystems.

That is the point exactly. What is sustainable? Sooner or later it will end because that is the natural cycle of the market. Maybe it could last up to 10 years but do you really believe it is all really "sustainable"? Nothing is sustainable. History has already showed us countless times that what goes up must come down. I do not know how you can deny that.

semantic arguments but according to Merriam-Webster definition#3 for sustainable is: able to last or continue for a long time
https://www.merriam-webster.com/dictionary/sustainable
Is few years a long time? To me, it is, but to OP it isn't...

That is a good analogy however i believe this true only for ideal conditions


Well, out of how many recent project with crowdsales have lived up to there full potential or promises?

but i do think this is more sustainable

Ok so it is a long time for you. But the argument is "if it is sustainable?" If after a few years it comes crashing down again, would you be able to say then that it is sustainable? I am thinking about the big picture where you can cite the rise and fall of civilizations in the history of the world. That itself shows that nothing is sustainable.

Aah..well, by that token the only thing so far that was found truly sustainable in your definition is the proton, where so far they could not detect a single decay event, suggesting that proton's half life is higher than 1.67X10^34 years, which is no less than 10^24 times longer than the age of the current universe (trilliontrillions of current universe ages). That is sustainable, indeed..so there is something...  ;D

Took  the bastards long enough to figure it out..

I disagree. One would expect of an increasingly successful and useful protocols that it would have increasing amounts margin traded, and not margin traded as well. The amount of money moving around the btc network is still tiny, there is much potential for increase. Even If it is a protocol used only for establishing trust, if you think of say volume of data moved over the internet as a protocol, the potential amount of value that people can choose to decide to trust the btc network to record/keep custody of for an amount of time - well there is a lot of upside there. Especially I would say with the bloody imf, world bank,world trade organization and those goon clubs that manipulate currencies, economies, banking and politics for their own financial gain. Public ledger protocols that are free from their reach/influence will hopefully serve to combat these sorts of groups influence.

We could go on a little further with that. The proton itself is not sustainable if the universe is expanding and then collapsing back to a singularity.

So you see even if your definition of something is sustainable will last 100 years in an economy, really it is not. Think about it. The more with your declaration that a "long time" for you is 2 or 3 years. That kind of "sustainability" is laughable.

They finaly figured out that the real gem is not in the adaptation of a digital ledger to function as a Blockchain, but for a Blockchain to function like Bitcoin. The <private> networks will not be widely supported, because there will always be the trust issue. What will happen if the public accept a <private> permissioned Blockchain, where they have ZERO transparancy or inputs into the core building blocks of the direction where the technology is going. < Who will determine the Coin Cap, and how easy will it be to increase it? >  ::)

You cannot invest in something, if you cannot trust it. The consensus in Bitcoin, give it some degree of trust. 

During the three years you mentioned the price of bitcoin have seen both ends ,highs and lows in the past one year .Now more people are using bitcoin and more countries are bringing in new rules and regulations which in turn helps bitcoin and so is the reason we are seeing a sustained rally.

Sustainability through growth, for now. Once Bitcoin has a large, respected, good source of value for a lot of people it can be sustained just through people using it. For now, we have to get it more valuable and get people using it.

More people seeing it as useful keeps the money flowing in, the more it goes up, the more people eye it with curiosity. The more that eye it, the more that join. The more that join... you know the rest.

Thanks for sharing the blog post. Interesting insight and a 180 degree turn compared to the 'classic' investing in the web.

https://i.imgur.com/cz6Xrwn.png

versus

https://i.imgur.com/6uKSty0.png

yeah, the central point is that you get most benefits by just investing in protocol/tokens vs the rest of the internet, where investment in services (Google, Facebook, Amazon) was the most lucrative.
the good news for us is the following: there are no inside deals on buying bitcoin vs at least Google and facebook where they started publicly trading at about 40bil and 116 bil, respectively. Most appreciation percentage wise was, of course, between a few mil and 40-116bil, NOT after they become public.
https://techcrunch.com/2011/01/10/facebook-5/

Peter Thiel invested $500 K and got 3% of the Facebook, which is about $10bil now (he probably sold some or most after the IPO).

That is also my point. Lots of empty talks, don't bring support in the hard time. They are just empty promises that worth absolutely nothing when it comes to correction. And my guess is that the correction should be behind the corner, as the technical indicators indicate.

This rally is not going to subside any time soon. So it is best just to ride the wave into the Christmas holidays and into the New Year! ;)

Do we have any proper data about whether the bitcoin based companies have actually made any profits? Investing in bitcoin companies seemed to be a big thing in 2014/15, but then news of new investments seemed to disappear.

(emphasis mine)

I'd say most, but certainly not all. In a selected (but ever widening set of) circumstances, Bitcoin is the best and sometimes the only payment system available. People in Venezuela are using it to buy toothpaste and cancer medications.