Most investors don't hold their own keys anyhow, so this won't make a difference for most people.

It's no different than using Coinbase or Binance or some other wallet app.

And a public ledger is not very... private. My GMail account is more private than Bitcoin because at least there would need to be a valid court order to breach my private email messages. Bitcoin transactions can be triangulated by anybody on the Internet.

Touché!

But my scenario here wouldn't portend a small drop like it's seen in the past few days, but rather a huge drop like it saw 18 months ago, or maybe much more. My thesis here is that the current price is based on the perception that Bitcoin has mass appeal, and when the market finds that it doesn't, it would correct to a much, much lower level.

I understand very well why it was created, but... that's not how it evolved. Today, almost all Bitcoin transactions have a third party involved because almost no mainstream investors physically hold their own private key. It's certainly possible Bitcoin could be used that way, but it mostly isn't, and the reason for that is that most people don't care about "centralized" and "decentralized" and don't even know what that means. To most investors today, Bitcoin is nothing more than the word, "Bitcoin".

And it doesn't matter what potential investors think... unless you are talking about the market price of Bitcoin. I am not trying to say here that Bitcoin is worthless, or that it's price will go to zero, only that the current price depends on a mass appeal which could evaporate because of the attention the ETF is bringing.

Also, you understand Bitcoin isn't great for anonymity, right?   

You make good points. Maybe all of the downsides of the ETF I listed here have been priced in already.

I would think that the ETF moves the "serious investor" scrutiny way, way up, but... maybe I'm wrong about that? We'll see.

Yes, but what actual value does blockchain serve? Technologies like blockchain have come and gone through the years, and blockchain doesn't have any verified technical uses besides cryptocurrencies and NFTs.

And yes, there are a lot of investors who love Bitcoin, blockchain, and so on--obviously, since Bitcoin is worth hundreds of billions. But what if the rest of the world isn't interested in this technology as an end in itself and just looks at Bitcoin and blockchain in purely practical terms?

I agree there's probably a price floor somewhere for Bitcoin, but it could be a lot lower than the current price...


Um, if it's an ETF, it's not an "alternative" anymore, it's actually a mainstream investment. That was the whole point  .

And if your pitch to main street USA investors is that Bitcoin is, "capable of replicating social scalability", well, I'm going to bet that pitch doesn't... persuade a lot of people .

I'm just going to throw a contrarian view out here for discussion...

What if, by positioning Bitcoin as a serious investment that is judged along side other investments in companies, real estate, hard commodities, bonds, and so on, that the scrutiny actually diminishes Bitcoin's appeal?

Bitcoin is now having a very strong light shined upon it. In a sense, it's being exposed to daylight for the first time, no longer being in the shadow realm of boutique techie investors like it has been.

What happens when "mainstream" investors find out that Bitcoin isn't really a viable mainstream currency, and that it's really only useful as a meme investment instrument with no inherent value beyond its own name? What happens when they find out that the "decentralized" thing is just a myth, and that, in actual reality, almost nobody uses Bitcoin (or any other cryptos) that way? What if the "serious" investment managers discover that the mythology behind Bitcoin is just... mythology?

What happens, in short, when Bitcoin ventures outside of its tight community of enthusiastic anarcho-libertarians--who desperately want Bitcoin to succeed for geopolitical reasons--and it is instead evaluated, coldly, like any other investment by people who don't have that political agenda?

And what if the first impression of millions of mainstream potential investors in Bitcoin is that it's just a super-volatile asset that only seems to go down in price?

I posted a similar explanation on another thread, and I think it applies to this one...

Take, for example, people who live in countries where currency there is very volatile who keep their wealth in an offshore account, and transfer only the money they need in their sovereign currency that day or even minutes before a purchase. You can also imagine having a credit card that draws from an investment account, wherein your wealth is stored in whatever instrument you want and everything will be handled for you behind the scenes vis a vie the exchange rates.

With credit cards and the Internet, one can imagine a the "UI" for your money always being displayed in some measure of wealth you can understand, e.g. US dollars for instance (and yes, this is exactly what we're doing at Haypenny with the USDE mechanism).

Most people aren't able to abstract a difference between their payment mechanism, their wealth store, and their measurement mechanism ("how much does it really cost me?"), but this is exactly what you need to do in order to understand today's globalized world of finance.

And in this world, Bitcoin and cryptos are speculation instruments, not payment mechanisms. Currency that can viably be used for payment e.g. US dollars or (eventually) Haypenny currencies are all both investments and payment mechanisms. In other words, if you hold Euros, you are essentially investing in Euros, and you can also broadly make payments in directly Euros, etc.

So in summary, there are three different things an instrument can give you:

1. A means of speculation, e.g. an investment you surmise will go up in value.

2. A means of transacting with others ubiquitously.

3. A means of understanding the value, in your own terms, of a given transaction (e.g. converting it to USD or whatever your "native" currency is that your own brain to "keep score").

Bitcoin and cryptos do #1 only, practically speaking.

Haypenny does #1 and #2 (and it's UI allows you to do #3 in USD specifically).

Traditional currencies do all three.

So if you understand that, the right answer to this thread's question is:

Use Bitcoin as an investment, and convert it to whatever currency your landlord requests each month. There's no advantage in transacting with them directly in Bitcoin, and lots of disadvantages e.g. slow, expensive, and inconvenient.

You could potentially use a volatile currency if you only held small amounts of it at a time.

Some people who live in countries where currency there is very volatile (although not anywhere near as volatile as Bitcoin) will keep their wealth in an offshore account, and transfer only the money they need in their sovereign currency that day or even minutes before a purchase. And if you have a credit card that draws from an investment account, your wealth can be stored in whatever instrument and everything will be handled for you behind the scenes vis a vie the exchange rates.

And with credit cards and the Internet, one can imagine a the "UI" for your money always being displayed in some measure of wealth you can understand, e.g. US dollars for instance (and yes, this is exactly what we're doing at Haypenny with the "USDE" mechanism).

Most people aren't able to abstract a difference between their payment mechanism, their wealth store, and their measurement mechanism ("how much does it really cost me"), but this is exactly what you need to do in order to understand today's globalized world of finance.

And in this world, Bitcoin and cryptos are speculation instruments, not payment mechanisms. Currency that can viably be used for payment e.g. US dollars or (eventually) Haypenny currencies are all both investments and payment mechanisms. In other words, if you hold Euros, you are essentially investing in Euros, and you can also broadly make payments in directly Euros, etc.

So in summary, there are three different things an instrument can give you:

1. A means of speculation, e.g. an investment you surmise will go up in value.

2. A means of transacting with others.

3. A means of understanding the value, in your own terms, of a given transactions (e.g. converting it to USD or whatever your "native" currency is that your own brain is used to).

Bitcoin and cryptos do #1 only, practically speaking.

Haypenny does #1 and #2 (and it's UI allows you to do #3 in USD specifically).

Traditional currencies do all three.

But if anything, the ETF demonstrates that the vision of a decentralized technology is a complete failure as a mainstream alternative to current centralized money systems: people don't use Bitcoin that way and they never will.

The ETF shows that nobody really cares about decentralization: they just want a meme to invest in that will go up in value.

(All of the websites, institutions, centralized wallet apps and basically everything that stores private keys in a centralized database does the same thing: shows that consumers don't want "decentralized" anything).

I don't see Bitcoin as a global currency. And I agree, it's not necessarily a bad thing. Lots of technologies start off as one thing and evolve into something completely different.

Bubble wrap was originally created as a wallpaper, for instance:

https://www.businessinsider.com/successful-products-that-were-originally-intended-for-a-completely-different-purpose-2016-3

Good: people will be able to buy "Bitcoin" (scare quotes intentional) as easily as they buy any other security with their brokerage account.

Good: Bitcoin cements its place as a pure meme investment attached to nothing tangible whatsoever.

Good: This very well may increase the price of "Bitcoin".

Bad: This event underscores what many of us have known for a long time, which is that Bitcoin will never be a real mainstream currency and doesn't need to be. The original thesis of Satoshi N. has now been thoroughly discredited, as the blockchain architecture has proven itself impossible to scale to even a ten-thousandth of the volume necessary to service the world's current transactions. Almost no holders of Bitcoin keep their own private keys, which means they are kept in some institution, which is kept in some centralized database somewhere, making a mockery of the original vision of Bitcoin.

Bad: "Bitcoin", to almost all of it's investors, is just the word, "Bitcoin" and nothing else, and the ETF will just increase that.

Good/Bad: Bitcoin invented a new kind of pyramid investment, and made this kind of investing more efficient and pure than it's ever been. (Whether that's a good thing or a bad thing depends on your own views of these kinds of investments).

Yes, Congress authorized the president to have broad leeway in conducting various operations. They could revoke it at any time. And yes, Congress authorizes all payments to countries, either directly or in a broad way e.g. specifically allowing the president to have discretion.

And yes, Putin is a dictator. His "elections" are clearly window dressing and there is no chance he will ever lose these "elections", just like Xi in China, Kim Jong Un, and so on. The Russian people in fact have no choice.

The 14th Amendment was passed by Congress and the States nearly unanimously. It is part of our Constitution, but if you desperately want an insurrectionist to be president, and there are enough like you, you can repeal the 14th Amendment with a vote by Congress and the States.

The Supreme Court is appointed by the President, who is elected. They will interpret the 14th Amendment and determine whether Trump should be on the ballot, based on the laws the people of the United States approved.

The US is a democracy. Russia is not.

There's no difference between stablecoins and Bitcoin either. Both are just investments.

And "the government" isn't going to come "shut down" Bitcoin. Why would they? After 10+ years Bitcoin still isn't used as a currency--not that "the government" would have a reason to care even if it were.

So no difference between a dictatorship and a democracy, as far as you are concerned?

Without NATO, all of Europe would part of the Soviet Union.

Um, no? If you define "conservative" as being in favor of a stronger national defense and a stable, law-abiding government, these days the Democratic party in the US is the one that's mostly in favor of that, and the Republican party is mostly against that.

What got "mixed up" is that the parties just reversed themselves in the last 15 years. Republicans are now calling for the regulation of industries that make their voters angry, along with all sorts of things that are not traditionally "conservative". The term might have meaning academically, but it doesn't relate to anything in the real world anymore, at least in the US.


What the Nazis, the Soviets, Chinese Communists, and a bunch of other regimes showed the world is that the ideology was just window dressing for a dictatorship. And once you have a dictatorship, what "the people" think is meaningless. And the new versions of those regimes in Russia and China shows that the dictators there don't really care about any coherent ideology outside of remaining dictators.

Now, if you want to talk about democracies, that's a different story. But I would argue that here in the US our two political parties have mostly or entirely abandoned their traditional ideology in favor of promoting whatever it is that gets them elected.

It's quite democratic, yes. Congress specifically authorized the president to do that. And in our country, the president is elected.

Democracies aren't always right and they aren't always perfect, but they are far better than the alternative.

It's simply unfathomable that the US could engage in a war like Putin is waging now in Ukraine because our government is accountable to the people.

Net-net, Bitcoin ETFs are not "bad for Bitcoin as a decentralized digital currency" because in actual reality, Bitcoin was never a decentralized digital currency.

All the ETF is doing is formalizing Bitcoin's place as a pure meme investment, aka a pyramid scheme.

There were thousands of pyramid investments before Bitcoin, and there will be thousands after. There's nothing wrong with investments like this, and with Bitcoin's market cap, I think we can safely say there's a demand for this kind of product.

But the blockchain architecture always made it impossible for Bitcoin to scale to the level of a real digital currency (unlike, say, Haypenny), and it will never be used as one in a mainstream way. And that's... okay!

I suspect that, numerically at least, almost no investors in Bitcoin hold actual private keys themselves on their own person.

Bitcoin is, in practicality, mostly a meme investment instrument, not a currency...

Or, it could ruin your life if the price of Bitcoin falls.