Are terms pyramid scheme and ponzi scheme misused?

[Impaler]

Yes some business will initially plow all their Revenue back into expansion and show no Profit.  But that is not an accurate description of BTC, the model is not capable of turning a profit by simply reducing it's expansion rate, like a shark it has too keep swimming or die.  I think you would agree that BTC would need such radical changes in it's protocol that it would no longer BE Bitcoin anymore.

So while I do not believe BTC is sustainable, I do think their is a future for Crytographicly secured currency, and even decentralized Peer2Peer forms of it.  But the sustainable implementations will come from new systems that go in radically different direction.  This is why I'm with Freicoin which takes the base technology in a direction that BTC would never go, and with the goal of making a sustainable currency.

[1713284652]

1713284652

[1713284652]

1713284652

[1713284652]

1713284652

[1713284652]

1713284652

[1713284652]

1713284652

[1713284652]

1713284652

[npl]

Well, in the dev forum there is certainly acknowledgment of the concerns you've raised and some proposals to address them. I wouldn't give up the game on BTC just yet, if only because if it falls the crash will be so spectacular that it will likely take all other crypto coins along with it.

I like Freicoin but it is difficult to drive early adoption to a product that discourages hording and thus has little speculative upside.

What I predict will eventually happen is we will see a separation into two financial instruments - 'coins' that are primarily a store of value (displacing gold); and coins that are primarily a medium of exchange (displacing the $).

The BTC paradox is that when it was created it was intended to become the latter (so Satoshi claimed) but the manner in which the protocol was devised makes it far more suited to the former.

[Ibian]

Why do some people think saving is bad anyway? What is meant by wealth distribution in practical terms and why should people go along with it?

Greed is basic human nature and is the driver behind bitcoin. Without a possibility of turning a profit nobody would invest meaningful money into it. Greed is, in other words, good, or at the very least necessary.

What makes bitcoin unsustainable? The fact that it will some day stop rising in value? But that is exactly what others say is necessary to make it a useful currency. Is it simply envy at work or is there something being left out of the discussion?

[npl]

Why do some people think saving is bad anyway?

I don't think anyone made that argument here, but that is certainly an interesting question to ponder vis-à-vis bitcoin - if it *were* to become the dominant global currency, and given how it encourages saving, the economic landscape would change in quite fundamental ways.

Not all of this is predictable of course, but e.g. you might be a bitcoin millionaire -  but forget about buying that new Ferrari, no one would be around to make it (because the opportunity cost of simply sitting on the coin rather than investing in infrastructure would make it extremely unprofitable). The only things people would still be producing on an industrial scale would be necessities, and prices would be very dear.

People would therefore likely group together in largely self sustaining communities, but since control of land and other resources will be concentrated in so few hands we might see pseudo-feudal systems developing, where land is exchanged for labour by local mega landlords.

But I digress and this is all just speculation. Sorry.

 

[Ibian]

Doubt it would go that way. Look at your stereotypical lotto winner, they go out and spend their money instead of investing it and living off the interest which would enable them to live a nice life without ever having to work again.

Same with bitcoin, people will spend what they need to get what they want. I personally plan to travel and maybe buy a boat before it reaches anywhere near maximum value. Only for a small part of it of course, but still enough that, years later, I could be looking at lost millions.

And businesses right now make sick profits from accepting payment in bitcoin. If anything, production of consumer goods would go up.

[npl]

What makes bitcoin unsustainable? The fact that it will some day stop rising in value?

No. Reread Impaler's post. What is unsustainable is that transaction fees are rising rapidly, but that at the same time they are unable to cover network costs.

But - the second graph doesn't mean a lot by itself, we need to see transaction fees as a percentage, not as a dollar figure- and even then what's interesting is the median, not the average.

https://blockchain.info/charts/cost-per-transaction

[btc4ever]

One could argue that bitcoin's sustainability is not yet fully tested.

Currently miners are highly incentivized by the block reward.  The question is, as that dwindles towards zero, will miners be sufficiently rewarded by transaction fees to continue providing adequate hashing power to secure the network.  Arguably, for that happen, a market mechanism for transaction fees must be operating in the system, and that is not yet the case, though I hear developers have plans in the works.  Also, there is the matter of block size and the lengthy 10 minute window...

"A pyramid scheme is an unsustainable business model that involves promising participants payment or services, primarily for enrolling other people into the scheme, rather than supplying any real investment or sale of products or services to the public" - http://en.wikipedia.org/wiki/Pyramid_scheme

Bitcoin is already a working currency.  So its not any more unsustainable than any other project and as such it can't ever be considered a Pyramid scheme.

[AnonyMint]

Doubt it would go that way. Look at your stereotypical lotto winner, they go out and spend their money instead of investing it and living off the interest which would enable them to live a nice life without ever having to work again.

Same with bitcoin, people will spend what they need to get what they want. I personally plan to travel and maybe buy a boat before it reaches anywhere near maximum value. Only for a small part of it of course, but still enough that, years later, I could be looking at lost millions.

And businesses right now make sick profits from accepting payment in bitcoin. If anything, production of consumer goods would go up.

Your stereotypical Bitcoin owner is going to end up just like people who plow their savings into the lotto-- bankrupt.

You won't be buying a boat nor traveling, because you will sell too late and for the gains you do cash out (if any), it is my belief the authorities will come clawing it all back as Bitcoin is going to destroy 99% of the people in it, and thus there will be calls for action from those instead of getting their dream ended up with a nightmare result.


Disclaimer: I am not giving investment advice. Consult your own professional. I am merely sharing my unprofessional thoughts. I have no position long nor short in BTC, nor do I plan to obtain one.

[AnonyMint]

What makes bitcoin unsustainable? The fact that it will some day stop rising in value?

No. Reread Impaler's post. What is unsustainable is that transaction fees are rising rapidly, but that at the same time they are unable to cover network costs.

But - the second graph doesn't mean a lot by itself, we need to see transaction fees as a percentage, not as a dollar figure- and even then what's interesting is the median, not the average.

https://blockchain.info/charts/cost-per-transaction

I don't understand that chart. Is it saying that it costs $50+ in transaction fees per transaction or per block?

Btw, I predicted Spiraling Transaction Fees Destruction of Bitcoin.

Also Bitcoin appears to be broken already. Sending medium size (e.g. $50) transactions from localbitcoins to Bitpay invoice is not working. These were working at 1 BTC = $350. I suppose the system has frozen because all the transactions are going to those buying and selling BTC for dollars in mania speculation fever, thus willing to pay much higher transaction fees.

This sort of thing if true, may be the end folks. If I owned BTC, I would get out while I still could before the greed turns to fear and a stampede towards 0.

Here is what Bitpay did in the past, yet I don't expect that localbitcoins is delaying broadcasting the transaction:

http://blog.bitpay.com/2013/03/applying-late-transactions-to.html


Disclaimer: I am not giving investment advice. Consult your own professional. I am merely sharing my unprofessional thoughts. I have no position long nor short in BTC, nor do I plan to obtain one.

[Ibian]

What makes bitcoin unsustainable? The fact that it will some day stop rising in value?

No. Reread Impaler's post. What is unsustainable is that transaction fees are rising rapidly, but that at the same time they are unable to cover network costs.

But - the second graph doesn't mean a lot by itself, we need to see transaction fees as a percentage, not as a dollar figure- and even then what's interesting is the median, not the average.

https://blockchain.info/charts/cost-per-transaction

The transaction fee has been adjusted several times already and will be again. And participation in the network is voluntary - if it's too expensive for you, you have the option of not being part of it. Most objections of that sort stem from simple ignorance of some aspects of the system. And I have no doubt people will keep making them for years to come.

[AnonyMint]

What makes bitcoin unsustainable? The fact that it will some day stop rising in value?

No. Reread Impaler's post. What is unsustainable is that transaction fees are rising rapidly, but that at the same time they are unable to cover network costs.

But - the second graph doesn't mean a lot by itself, we need to see transaction fees as a percentage, not as a dollar figure- and even then what's interesting is the median, not the average.

https://blockchain.info/charts/cost-per-transaction

The transaction fee has been adjusted several times already and will be again. And participation in the network is voluntary - if it's too expensive for you, you have the option of not being part of it. Most objections of that sort stem from simple ignorance of some aspects of the system. And I have no doubt people will keep making them for years to come.

I tried to distill the information content of your post, and ended up with the empty set.

Did you make any point?

The linked chart is showing rising transaction fees. And it is showing them to be too high apparently to send a $50 transaction from localbitcoins to bitpay, two of the most popular Bitcoin services.

What "objections of the sort"? We are talking reality of what is anecdotally happening right now, not objections.

[hilariousandco]

Why do some people think saving is bad anyway?

Saving is great, but there's probably gonna be a point where you want to cash out or spend your BTC on something physical. And at what point do you cash out and/or start buying tangible goods? Do you become greedy and hoard your BTC in the hope it'll be worth millions some day, or do you cash out when it's worth thousands and sit back on a tidy profit? Remember, it could all go tits up any day or even the day before you're about to cash out for your millions and you'll be left with nothing. Suddenly that few K you could've made seems a lot bigger when you're left with zero or only a few $.

[Rassah]

Also Bitcoin appears to be broken already. Sending medium size (e.g. $50) transactions from localbitcoins to Bitpay invoice is not working.

Did you know it's against BitPay TOS to use their service as your own personal bitcoin exchange? Plus, I thought you didn't have any bitcoins,so how did you see that issue?

Also, I have sent at least 6 transactions with zero fees in the last 3 days with no issues. All confirmed just fine.

[Rassah]

What I predict will eventually happen is we will see a separation into two financial instruments - 'coins' that are primarily a store of value (displacing gold); and coins that are primarily a medium of exchange (displacing the $).

This would only make sense (happen) if the medium of exchange coins somehow had less transaction friction than the store of value coins.  That would mean the medium of exchange coin having more apps, hardware wallets, exchanges/liquidity, and merchants. If a store of value coin happens to have more of those, it will simply be easier to use it instead of the medium of exchange, regardless of what the coin's intentions were.

[AnonyMint]

Also Bitcoin appears to be broken already. Sending medium size (e.g. $50) transactions from localbitcoins to Bitpay invoice is not working.

Did you know it's against BitPay TOS to use their service as your own personal bitcoin exchange?

I have no idea why you erroneously assumed localbitcoins wallet can not used to send payments to merchants.

I didn't write that the instance was my BTC holding.

[AnonyMint]

What I predict will eventually happen is we will see a separation into two financial instruments - 'coins' that are primarily a store of value (displacing gold); and coins that are primarily a medium of exchange (displacing the $).

This would only make sense (happen) if the medium of exchange coins somehow had less transaction friction than the store of value coins.  That would mean the medium of exchange coin having more apps, hardware wallets, exchanges/liquidity, and merchants. If a store of value coin happens to have more of those, it will simply be easier to use it instead of the medium of exchange, regardless of what the coin's intentions were.

Not if buying the Bitcoin requires impoverishing oneself and society into hyperinflation.

You can't have this type of radical transfer of wealth to speculators. Society will never allow it.

[Rassah]

What I predict will eventually happen is we will see a separation into two financial instruments - 'coins' that are primarily a store of value (displacing gold); and coins that are primarily a medium of exchange (displacing the $).

This would only make sense (happen) if the medium of exchange coins somehow had less transaction friction than the store of value coins.  That would mean the medium of exchange coin having more apps, hardware wallets, exchanges/liquidity, and merchants. If a store of value coin happens to have more of those, it will simply be easier to use it instead of the medium of exchange, regardless of what the coin's intentions were.

Not if buying the Bitcoin requires impoverishing oneself and society into hyperinflation.

You can't have this type of radical transfer of wealth to speculators. Society will never allow it.

Bitcoin doesn't have feelings, and thus doesn't care if it is impoverishing anyone into anything. So if causing hyperinflation to other currencies is the end result of bitcoin's existence, people will just try to be the first ones on the bitcoin bandwaggon, instead of being the last ones left holding the fiat bag.


How do you supposee that society will not allow that? Society can't tell who has how many bitcoins and it can't stop people from buying or exchanging bitcoins. Do you expect that people will stubbornly hold on to their bags of fiat out of sheer want to preserve their society? That will only work until some of those holders think "screw the rest of you" and start moving into BTC. In the end, you'll end up with the same scenario as above.

[AnonyMint]

What I predict will eventually happen is we will see a separation into two financial instruments - 'coins' that are primarily a store of value (displacing gold); and coins that are primarily a medium of exchange (displacing the $).

This would only make sense (happen) if the medium of exchange coins somehow had less transaction friction than the store of value coins.  That would mean the medium of exchange coin having more apps, hardware wallets, exchanges/liquidity, and merchants. If a store of value coin happens to have more of those, it will simply be easier to use it instead of the medium of exchange, regardless of what the coin's intentions were.

Not if buying the Bitcoin requires impoverishing oneself and society into hyperinflation.

You can't have this type of radical transfer of wealth to speculators. Society will never allow it.

[snip]

How do you supposee that society will not allow that?

Wow you really doubt the power of the government. I guess you forget who has the bigger guns.

You are not anonymous in Bitcoin. They can attack with the tax agencies without bringing out the big guns. The big guns are the last resort. As the final resort, nuclear winter and the underground shelters the elite have built.

Absolutely no way the elite will hand over the power over the creation of money. They will co-opt it peacefully or by as much violence as it requires.

http://en.wikipedia.org/wiki/James_Warburg

Warburg was a member of the Council on Foreign Relations. He gained some notice in a February 17, 1950, appearance before the U.S. Senate Committee on Foreign Relations in which he said, "We shall have world government, whether or not we like it. The question is only whether world government will be achieved by consent or by conquest."

[Rassah]

Not if buying the Bitcoin requires impoverishing oneself and society into hyperinflation.

You can't have this type of radical transfer of wealth to speculators. Society will never allow it.

[snip]

How do you supposee that society will not allow that?

Wow you really doubt the power of the government. I guess you forget who has the bigger guns.

You are not anonymous in Bitcoin. They can attack with the tax agencies without bringing out the big guns. The big guns are the last resort. As the final resort, nuclear winter and the underground shelters the elite have built.

Absolutely no way the elite will hand over the power over the creation of money. They will co-opt it peacefully or by as much violence as it requires.

http://en.wikipedia.org/wiki/James_Warburg

Warburg was a member of the Council on Foreign Relations. He gained some notice in a February 17, 1950, appearance before the U.S. Senate Committee on Foreign Relations in which he said, "We shall have world government, whether or not we like it. The question is only whether world government will be achieved by consent or by conquest."

Oh! I thought by "society" you meant "society," as in the socialism-voting middle to lower class, not the wealthy elite who will likely be one of the first to move their money into bitcoin, and out of the reach of money-grubbing government. You know, the one that relies on its money-grubbing to pay for things like big guns and winter-causing nuclear weapons. Plus no amount of big guns or nukes can decrypt a password or a private key.  

[Impaler]

Oh! I thought by "society" you meant "society," as in the socialism-voting middle to lower class, not the wealthy elite who will likely be one of the first to move their money into bitcoin, and out of the reach of money-grubbing government. You know, the one that relies on its money-grubbing to pay for things like big guns and winter-causing nuclear weapons. Plus no amount of big guns or nukes can decrypt a password or a private key.  

But your BTC early adopters have already decided that they will not sell, rather they expect to hold coins until they are wealthier then the current 'elites', thus your giving the current elite no peaceful option to preserve their wealth and position by buying into BTC.  Your ultimate aim is to over throw them and become the new elites, which is the OLDEST game in history btw.  But your trying to win that struggle with a mere software protocol, a tool which is completely dependent on the infrastructure of the internet, hardly a reliable weapon.  Groups that typically win battles to overthrow elites have access to their own independent sources of power.