Logical and mathematical truth of bitcoin

[dohh]

Those who want to believe in BTC at all cost, should avoid this topic.
To help some people, who started to think about the core concept of bitcoin, my judgement is:

1) The blockchain part or "mining" in case of BTC is a special kind of scam. For getting a coin You must invest into electricity and computing power. In return You get VERY little chance to be awarded with a coin. This chance is so small, it is mathematically ridiculous, but in practise. ZERO! Nada, ничтo, nichts... What kind of decent money is that, that everyone can apply by spending real money but only few of many millions are actually given by basis of pure luck?

2) The coin part of BTC is a monetary fraud. Although people make transactions voluntarely, they are cheated with the very core concept of BTC. While blockchaining may have some usage as a concept as well as cryptocurrency, it does still not mean that BTC is legit.

Before You attack my opion, try to give logical answer to these questions:

a) why is BTC quantity limited with 21 millions? What limits it?
b) what is the point of decentralised money, if its so volatile, that rate would drop 75% in 6 months (or grows by the same)? this is called a hyperinflation.
c) why is blockchain technology better in 99,99% of transactions, than regular private/public key technology?
d) do You really understand, what is private/public key crypto and blockchain in its core, or they just sound cool?
e) if BTC had at more or less decent chance to boom again, why dont all the richest investors in world buy it?

Maybe it wasnt planned so, but BTC is the most genious scam in the history.

Previous doesnt mean, You absolutely can not make any money in it. The same goes for ponzis and pyramids. If You go in or out right time, You will earn and at some cases earn well!

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[First77]

I think "HYIP cartel" are using Bitcoin for their 200% to 400% profit per month HYIP programs/ponzis since Bitcoin is anonymous and unregulated.

HYIP programs pay high profits for 2 to 3 years and then they shut down.

[dohh]

I think "HYIP cartel" are using Bitcoin for their 200% to 400% profit per month HYIP programs/ponzis since Bitcoin is anonymous and unregulated.

HYIP programs pay high profits for 2 to 3 years and then they shut down.

yes, thats correct. viability of such ROIs in such period of time, is impossible.

[Red-Apple]

BTC is the most genious scam in the history.

yes you are correct. bitcoin is a scam so please sell the coins that you have so desperately been buying and leave us dumb people be in our scam in peace 

[dohh]

BTC is the most genious scam in the history.

yes you are correct. bitcoin is a scam so please sell the coins that you have so desperately been buying and leave us dumb people be in our scam in peace 

Obviously I dont have any, Im not stupid enough. I just want to help those people, who dont understand, that are scammed. I know few, that have "invested" instead of voluntary retirement plan, i just feel pity about them.

[eternalgloom]

b) what is the point of decentralised money, if its so volatile, that rate would drop 75% in 6 months (or grows by the same)? this is called a hyperinflation.

Is it really hyperinflation in Bitcoin's case? I've read that Bitcoin is used to protect against hyperinflation, even now people are buying it in Venezuela because of that reason.

From wikipedia:

In economics, hyperinflation is very high and typically accelerating inflation. It quickly erodes the real value of the currency, as the prices of most or all goods increase. This causes people to minimize their holdings in that currency as they usually switch to more stable foreign currencies.[1] Prices typically remain stable in terms of other currencies.

Unlike low inflation, where the process of rising prices is protracted and not generally noticeable except by studying past market prices, hyperinflation sees a rapid and continuing increase in nominal prices, the nominal cost of goods, and in the supply of money.[2] Typically, however, the general price level rises even more rapidly than the money supply as people try ridding themselves of the devaluing currency as quickly as possible. As this happens, the real stock of money (i.e., the amount of circulating money divided by the price level) decreases considerably.[3]

Source: https://en.wikipedia.org/wiki/Hyperinflation

Seems to me that you can't really describe the price drops of Bitcoin as hyperinflation. That term is reserved for national currencies.
I'm not an economist though, I'm sure someone else could explain it better. Just adding some counter arguments.

[dohh]

b) what is the point of decentralised money, if its so volatile, that rate would drop 75% in 6 months (or grows by the same)? this is called a hyperinflation.

Source: https://en.wikipedia.org/wiki/Hyperinflation

Seems to me that you can't really describe the price drops of Bitcoin as hyperinflation. That term is reserved for national currencies.
I'm not an economist though, I'm sure someone else could explain it better. Just adding some counter arguments.

Thanks for good comment.

I more meant hyperinflation de facto, than de jure.

As You correctly describe, hyperinflation means rapid increase of price or decrease of value of given currency. As there is not much You can buy for BTC, we have to compare its exchange rate with euros or dollars. There bitcoin is 4 times less worth, than 6 months ago. If any real currency had that kind of fall, it would be a catastrophe.

Its quite clear, Bitcoin is not currency, that carries any real value, but just object of speculation. Why Im so concerned then, when You could easily find many speculative stocks? Because all signs show, that Bitcoin is not based on real viable product/service. People dont understand, that the core concept of bitcoin is zero. Fans of bitcoins claim, that governments just print new money without any quarantee. Whats the quarantee of bitcoin then? Only thing I can quarantee You, is, that if to leave out speculated "value" of coin, it takes millions times more money, to mine one coin, than its value. And now, thats ridiculous...

[First77]

yes, thats correct. viability of such ROIs in such period of time, is impossible.

$1 to $10,000 in 9 years has never been heard of.. Mostly likely money getting created from thin air.

[pauline_78]

Stop spreading such negativity and FUD about bitcoin. You can certainly leave the market if you want to but don't try to insigate others. I will request all the readers not to fall in his trap. 

[dellmoon]

In market btc is the first crypto currency in the world based on this crypto currency is depend on btc so you need to know what is scam and what is real so you should know the proper idea of it based on this you can’t tell like this because I think you have lack of knowledge of btc.

[dohh]

In market btc is the first crypto currency in the world based on this crypto currency is depend on btc so you need to know what is scam and what is real so you should know the proper idea of it based on this you can’t tell like this because I think you have lack of knowledge of btc.

The whole idea is not viable. Think, how are miners going to be paid, after last coin is mined? The job of blockchaining still needs to be done and in increasing quantities only.

[izanagi narukami]

For me as investor doesn't care because all they want is profit.
Yes , there are a lot of ponzi scheme or other virtual currency that exist before bitcoin but who know that bitcoin able take people's demand around the world.
Most people are speculators and trend continue their activity until they reach their maximum peak !

[Gurjasmeet]

I think logical and mathematical truth of bitcoin is only a way of success that due to crypto currency depends upon bitcoin. so we should have to deeply study about this reality& scaling. but reason of popularity crypto is the first currency of the world.

[LodisMcguire]

Let's make it simple,even if it is mathematically ridiculous,as long as more people come to support it,it will become real.No matter how it works,if more people demand bitcoin,of course it will be used and the price will keep in the volatile state.

[BitcoinNewbie15]

Those who want to believe in BTC at all cost, should avoid this topic.
To help some people, who started to think about the core concept of bitcoin, my judgement is:

1) The blockchain part or "mining" in case of BTC is a special kind of scam. For getting a coin You must invest into electricity and computing power. In return You get VERY little chance to be awarded with a coin. This chance is so small, it is mathematically ridiculous, but in practise. ZERO! Nada, ничтo, nichts... What kind of decent money is that, that everyone can apply by spending real money but only few of many millions are actually given by basis of pure luck?

The Bitcoin blockchain was designed to be like a lottery. Many people participating which contributes to the security of the network, and in turn, there is a winner once every 10 minutes. This is why pools have been formed, so you have a better chance of "winning".

Before You attack my opion, try to give logical answer to these questions:

a) why is BTC quantity limited with 21 millions? What limits it?

The limit is hardcoded and cannot be changed without forking and therefore creating an altcoin. It is limited to this amount to resemble precious metals and create scarcity.

b) what is the point of decentralised money, if its so volatile, that rate would drop 75% in 6 months (or grows by the same)? this is called a hyperinflation.

The point of decentralized money is to give control to the people and remove control from the banks/1%. Bitcoin is only this volatile because the market is so incredibly small. As the market becomes larger the price will become less volatile. It's already happening, Bitcoin was a lot more volatile a few years ago.

c) why is blockchain technology better in 99,99% of transactions, than regular private/public key technology?

Because it does this in a distributed decentralized manner.

e) if BTC had at more or less decent chance to boom again, why dont all the richest investors in world buy it?

Because nobody knows what will happen for sure. Some of the richest investors are buying it already. There are too many to name, but jack dorsey, peter thiel, chamath palihapitiya, etc.

Maybe it wasnt planned so, but BTC is the most genious scam in the history.

Previous doesnt mean, You absolutely can not make any money in it. The same goes for ponzis and pyramids. If You go in or out right time, You will earn and at some cases earn well!

How excatly is Bitcoin a scam? It doesn't fit under any definition of scam. It especially doesn't fit under the definition of Ponzi or Pyramid scheme.

[pauline_78]

Stop spreading such negativity and FUD about bitcoin. You can certainly leave the market if you want to but don't try to insigate others. I will request all the readers not to fall in his trap. 

[dohh]

How excatly is Bitcoin a scam? It doesn't fit under any definition of scam. It especially doesn't fit under the definition of Ponzi or Pyramid scheme.

It does. If the core concept is not viable, its basically the same as there is no real product behind. It is assumed, that 1 transaction takes same amount of energy as household in 1 week. Its so unreasonably expensive, that it makes transactions impossible in large volume.

https://digiconomist.net/bitcoin-energy-consumption

Just think about it and You see, Im right.

[dohh]

Let's make it simple,even if it is mathematically ridiculous,as long as more people come to support it,it will become real.No matter how it works,if more people demand bitcoin,of course it will be used and the price will keep in the volatile state.

You are wrong, because You are selfish. If I´m right and this project is mathematically ridiculous in its core, many people will unavoidably lose their money. For example, people, who actually bought BTC at 20 000 have lost 75% of their money!

Why is this different, when taking risk by purchasing real viable assets? Because, as an average value of real investments is expected to grow over time. When "investing" into scheme, You can not expect so, You will lose Your money, when it collapses.

Now... people have right to know their odds. There are good odds, that this is a monetary scheme and nothing more.

[dohh]

P.S. all of the answer is logical according to myself

1) The blockchain part or "mining" in case of BTC is a special kind of scam. For getting a coin You must invest into electricity and computing power. In return You get VERY little chance to be awarded with a coin. This chance is so small, it is mathematically ridiculous, but in practise. ZERO! Nada, ничтo, nichts... What kind of decent money is that, that everyone can apply by spending real money but only few of many millions are actually given by basis of pure luck?

"mining" supposed to be voluntary and the volunteer get rewarded, not for profit. Also, there's mining-pool to ensure you always get something.

Nope, mining is CLAIMED to be voluntary, but it is driven by price of BTC. People make communities and buy special equipment, to increase their mining odds. And there will NOT always be something to mine. It is confirmed, that number of released coins halves every 5 years. Thats mathematically exponential and will drop to nothing - there will be nothing left to mine.

2) The coin part of BTC is a monetary fraud. Although people make transactions voluntarely, they are cheated with the very core concept of BTC. While blockchaining may have some usage as a concept as well as cryptocurrency, it does still not mean that BTC is legit.

This statement doesn't make sense, explain it more detail.

One primary quality of frauds is, that there is absence of real product behind deals. Now, if product is very unreasonably uneffective, its the same, as its missing at all. It is estimated, that 1 transaction of BTC takes same amount of power, than household in week. Now, thats just not viable product.

a) why is BTC quantity limited with 21 millions? What limits it?

Because Satoshi Nakamoto set it to 21 million and it's coincidence with biggest number of 64-bit floating point number even though there are many other speculation.
But there's no limit and you can change the production/total supply, you just need community approval.

It´s essentially the same, as Nakamoto told, there is 21 million ounces of gold to find, when it finishesh of, community decides, there is more. Both parts of last sentence are not serious.

b) what is the point of decentralised money, if its so volatile, that rate would drop 75% in 6 months (or grows by the same)? this is called a hyperinflation.

That's the risk of truly decentralized currency, the exchange price to fiat can be manipulated easily. Also, you already answer the point.

That´s correct, if we have risky business on real product/service. Thats what I am saying: we DONT have a product behind here.

c) why is blockchain technology better in 99,99% of transactions, than regular private/public key technology?

Who claim that?

Enthusiasts. There are very few privileges in BTC compared to, say Paypal. Thats not in accordance with electry consumtion.

d) do You really understand, what is private/public key crypto and blockchain in its core, or they just sound cool?

There's plenty of explanation about asymmetric cryptography, so of course most bitcoiner already know about it.

They dont understand, that everybody uses it already. Its not an edgeof BTC.

e) if BTC had at more or less decent chance to boom again, why dont all the richest investors in world buy it?

Because investor don't know or don't believe the potential of Bitcoin.

Because they are smarter, than market in average.

In market btc is the first crypto currency in the world based on this crypto currency is depend on btc so you need to know what is scam and what is real so you should know the proper idea of it based on this you can’t tell like this because I think you have lack of knowledge of btc.

The whole idea is not viable. Think, how are miners going to be paid, after last coin is mined? The job of blockchaining still needs to be done and in increasing quantities only.

Isn't it obvious that miners still get paid by fees in transaction that they included in mined block?

Its not. If one transaction takes same power, than household in week, the price would be not competitive

[BitcoinNewbie15]

How excatly is Bitcoin a scam? It doesn't fit under any definition of scam. It especially doesn't fit under the definition of Ponzi or Pyramid scheme.

It does. If the core concept is not viable, its basically the same as there is no real product behind. It is assumed, that 1 transaction takes same amount of energy as household in 1 week. Its so unreasonably expensive, that it makes transactions impossible in large volume.

https://digiconomist.net/bitcoin-energy-consumption

Just think about it and You see, Im right.

The amount of electricity consumed has nothing to do with the network throughput. Bitcoins electricity consumption has to do with security. There doesn't need to be this much electricity being used to power Bitcoin. Bitcoin would function just fine if there was half the electricity being used, or even less than that. There are just a lot of miners mining right now because of the gold rush. Bitcoins second layer, the lightning network, will completely solve Bitcoins transaction throughput. The lightning network uses a negligible amount of electricity too.