Bitcoin obviously has a better design. It's elegant, functional and scalable. It is obviously more established and has much more users than Ethereum. But that's not the point, and it doesn't matter what ETH developers say.

The fact is that both BTC and ETH derive their valuation from speculation about future adoption. Real world usage of ETH is completely nil, and real world usage of BTC is maybe a hair above that. Total network transactions are so low, they are almost nonexistent compared to legacy financial infrastructure. The entire economy is built on centralized fiat gateways and payment processors. The arms race among miners is completely speculative. The community's general consensus that a) BTC will be adopted by the masses and b) that this will bring 6-8 figure dollar valuations is completely speculative. None of the assumptions about future adoption can be extrapolated from the past. Nobody has any real idea how to value BTC because it's not based on hard numbers. It's based on speculation that other people are going to join the network and drive the price up.

I think Sutters Mill makes a legitimate point. Trying to argue that BTC has lots of value outside of speculation (quantified how?) is a poor argument against ETH. They're both speculative assets. There are lots of reasons one can trash ETH based on its poor design choices.


I'm not sure I follow. ETH is the native currency on the platform. Why would gas fees be tied to currencies other than ETH?

In Bitcoin, we would never price transaction fees in anything other than BTC at the protocol level. Anything else would be absurd. I don't see the Core developers as "forcing" that on me.

I'm also quite skeptical that Bitcoin is going replace fiat currencies, unless people abolish governments entirely. Governments have no incentive to give up monetary control, and they will continue forcing people to accept legal tender for payment of debts and taxes. Most people are passive sheep and will do what government and society tells them to do.

The path I see is one where BTC gains status as a traditional investment asset. Governments and central banks will be forced to hold reserves as a hedge against geopolitical risk, but it would be nonsensical for them to cede monetary control and adopt BTC as legal tender. I'm not sure about mass adoption for commerce, not until we see user-friendly applications that allow for exponential scale. Then we'll see what actual adoption looks like.

I think you make a good case for why adoption rates for some technologies look like an S-curve. Regardless of social awareness, adoption is very slow at first -- whether because the technology is expensive, hard to use, paradigm-breaking, requires additional infrastructure, etc. At some point, adoption goes vertical. It's not immediate. That's the S-curve model.


Personally, I think Bitcoin's trajectory is more binary than that. As long the technology remains secure, I lean towards mass adoption.

As I see it, it's one or the other. Either KYC is too stringent and it discourages liquidity from entering Gemini's markets (so nothing really changes)... or it isn't. We'll have to wait and see. I wouldn't write it off just because of Tether's history. Gemini's reputation + NYDFS approval is in another universe vs. Tether.


Indeed, that's what I'm getting at. They can only control token issuance and redemption since have no control over the ETH network. Obviously, there's no way to stop North Korea from accruing these coins.

That's not really true. Beijing ordered state-owned ISPs to block individuals' use of VPNs by February 2018, ahead of an outright ban at the end of March. Some kid got sent to prison last year for selling VPN subscriptions.

I'm not sure if the ban is simply ineffective, if ISPs haven't moved to actually block use of VPNs, or some combination. It seems like it would be a game of whack-a-mole. It doesn't seem enforceable.


It's not going to be effective if they can't stop people from using VPNs. People could also just start encrypting their communications.

With Coinbase and most exchanges, it doesn't matter in terms of commissions. They charge a % commission on buys and sells. But they also charge a flat fee for BTC withdrawals, so if you buy $20 and withdraw it each week, the fees will add up.


Yes, you can avoid all fees -- trading commissions, deposit fees, withdrawal fees -- by using Coinbase Pro (GDAX).

Here's the process: ACH transfer USD to Coinbase (free), transfer to GDAX (free), place limit orders and wait for them to be filled (free), withdraw BTC to your wallet (free).

If you just use the basic Coinbase interface, they charge really high commissions, and they also charge BTC withdrawal fees. I highly recommend using their actual exchange -- https://pro.coinbase.com/

I would ditch earn.com -- it overestimates quite a bit.

BTC.com isn't too bad, but I definitely prefer Johoe's site for a fuller picture.


I always check the mempool before sending, too. It doesn't come up too often, but occasionally I'll send a transaction, then there isn't a block found for 1 hour or more. Average fees rise, transaction gets delayed even longer. In those cases, it's been helpful to have the RBF option.

I think they're trying to drive more liquidity to Gemini. Tether obviously has a big market share. If they can take a bite out of that, some of that liquidity should find its way back to Gemini's order books since it'll have the most liquid GUSD markets. I'm not sure how successful it'll be, since Gemini has pretty tough verification requirements vs. Bitfinex. But I'm really curious to see how this all turns out -- how much GUSD gets issued and what the secondary GUSD markets end up looking like.

Ukraine does it like the US then. In the US, capital gains are taxed at an individual's ordinary tax rate. It doesn't matter where the gains come from -- gold, real estate, bitcoins, etc. Everything is taxed at the same rate. There was a bill introduced to Congress last year to exempt cryptocurrency payments below $600 from taxation, but it didn't get added to the tax overhaul. I'm not sure if it's still being considered.


Presumably it was already being taxed. This isn't a new policy or anything.

I think it's possible if you expect growth to be exponential rather than linear. I assume Armstrong is drawing on the idea of growth curves like the S-curve. Once you "cross the chasm," adoption rate can go vertical.

The vast majority of television adoption happened over a period of five years or so. That's the most optimistic case, but if you look at recent examples like the internet and mobile phones, the rate of growth can be quite staggering:

There was a backlog over the past several hours. It doesn't help that there were only 6-7 blocks mined in the last 2 hours. I needed confirmation in the next block just now and sent a transaction for 12 satoshi/byte -- much higher than I normally spend. You'll probably get confirmed in the next couple hours.

Does Mycelium support opt-in RBF? If not, you might consider switching to another wallet that does, like Electrum. I always make my transactions replaceable in case of unexpected backlogs.

I guess another professor felt the need do outdo Professor Bitcorn, the Boston University professor who predicted that Bitcoin would fall to $10. I wonder what name the community will give to Roubini.

Fun facts: Apparently, this guy predicted the housing bubble crash of 2008 and he's been warning of various financial bubbles for years. He's known as "Dr. Doom."

Sure, there are similarities. You know what also seemed like the dot-com crash? The 2014 crash in Bitcoin and altcoins. In early 2014, lots of altcoins saw their first speculative bubbles. By late 2014, sentiment like yours was setting in. Not only was Bitcoin considered dead, but altcoins were considered beyond dead. However, it was the altcoiners buying the blood in 2015 that made the most astronomical gains in 2017.

History tends to rhyme, if it doesn't repeat. I say, give it time.

Centralized exchanges are necessary at this stage, considering how thin the p2p market is. And people are going to use them regardless of what we want to see. It makes no difference whether those USD liabilities are represented as a balance in your Gemini account or as GUSD. They are exactly the same thing -- a deposit redeemable at Gemini.

The only new development here is that we have a new option besides USDT, issued by a much safer exchange. More options = better, and it can help people avoid KYC. I don't see how this could ever be construed as a bad thing, unless you really like Tether and want USDT to continue dominating.


That's the point. Tether and Bitfinex are really shady. I think they're far more likely to have problems with regulators, law enforcement and banks than Gemini. I'd much rather hold GUSD than USDT. The issue isn't about stablecoins; it's about the reliability of their issuers.


That's because WEX shut down BTC and USD withdrawals, as well as several others. Anyone who wants to exit WEX needs to pay a huge premium to get their money out. That's why the USDT premium exists there, because you can actually withdraw it. It's worth $1 everywhere else.

There's obviously going to be a secondary P2P market that avoids interfacing with AML/KYC. Since it's built on ETH, there's nothing anybody can do to stop that from happening, as Gemini will only have control over issuance and redemption. I'm curious to see how regulators deal with that, and I'm honestly a bit surprised to see this approved by NYDFS.


I'll feel a hell of a lot safer holding Gemini liabilities than Tether liabilities. Gemini is super compliance-oriented, licensed wherever necessary, and has the green light from a major regulator. That's a huge improvement. I would love to hedge with this on the P2P market and avoid KYC with exchanges.

More efficient? Not really. Blockchains use huge amounts of redundancy to achieve trustlessness -- that's how decentralization works. The centrally administered databases that power banking transactions can be much faster and use less resources because they sidestep the entire mining and validation process.

It's correct that high-value transactions can be much cheaper than the legacy system -- you can send millions of dollars in value for pennies in fees. But that may not always be true. Fees are expected to rise considerably over the years because they are going to eventually replace the mining subsidy.

Here's a better source for the story: https://www.bloomberg.com/news/articles/2018-09-10/citigroup-is-said-to-plan-crypto-trading-by-issuing-receipts

I had never heard of these "digital asset receipts" or "American depositary receipts" before. It looks like they're structured sort of like physically backed ETFs: The commodity (BTC) is held by a custodian and receipts (shares) are issued by the bank based on that, which are then traded to brokers and sold to investors on the retail market.

It's a different angle than the ETF route, but as the article points out:

I never got the impression that TrueUSD was much different than USDT. Last I heard, it was secured by "smart contracts" that prevent "printing" of TrueUSD without backing -- not sure I buy that, as we're not privy to their trust account records.

And supposedly they're "in talks" with major accounting firms to provide audits. Where have I heard that before?

The fundamental difference here is that neither USDT nor TrueUSD were ever reviewed or approved by a state regulator. And NYDFS is quite hard to please from what I hear. So, I think this might actually be a game changer, though I'm not sure how the AML/KYC angle will work out. It adds a whole new level of confidence to stablecoins, since the biggest fear with Tether is bank seizures by regulators. I would love to see Tether's market share drop. So much of the economy is exposed to Bitfinex/Tether counterparty risk.

Parasites derive sustenance at the host's expense. That doesn't really work in this case. Hodlers aren't hurting anyone. They seem more like free riders to me, since they benefit from common usage and transaction liquidity but they don't contribute to it. If everyone were a hodler (so no one was using BTC, only hoarding it), BTC would have no value. A network needs usage and liquidity in order to be useful for anything.

So, I agree with the sentiment here but if you think about it, they're just being rational. If you're not going to use BTC (for example, as a medium of exchange), but you think its price will rise, should you buy it or not?

I think Patrick Byrne (Overstock CEO) made a similar prediction about mass tokenization and a fundamental shift in the way securities issuance and trading is done. I was annoyed at the time because of the proliferation of scam tokens, but they're probably right. A billion people in 5 years seems a tad outlandish, but it's not outside the realm of possibility either.

 
If not for Bitcoin's reliability, no one would have any faith in altcoins and certainly not in any tokens built on top of them. It's the monument of stability underlying the entire economy. Deep down, even Brian Armstrong knows that. But Coinbase is in the business of capitalizing on hype, so we shouldn't be surprised when they chase altcoins and tokens.