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Author Topic: Gold collapsing. Bitcoin UP.  (Read 1805717 times)
Cconvert2G36
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August 15, 2015, 01:16:48 AM
 #30541

Roll Eyes

Is AAPL competing with fiat as money?

Sorry but that's such a stupid thing to say. I'm sure you can do better than this...

Let me ask you. Did the current 1B$ ecosystem investment, equivalent billion dollar mining infrastructure, incremental userbase and increasing transactions come before or after the price increase?

Of course I'm being silly and hyperbolic, but only to illustrate that market cap isn't some "build it and they will come" metric.

There is a feedback loop between price and user growth, but it can only be sustained with growing utility.

"Yikes"

You still don't get it.

Stop thinking in terms of users. Think in terms of capital. This is not Facebook.

market cap isn't some "build it and they will come" metric.

On the contrary, when it comes to money (or networks for that matter) it seemingly works this way.

Let me borrow from the Facebook example again : create a huge network of people and they will come.

Create a huge network of money and you will attract wealth.

Look I'm not neglecting the positive added effect of these other feedback loops you are referring too. Merely downplaying their importance for the time being as some people have seemingly lost their eyes from the prize.

"When the wise man points at the moon, the fool looks at the finger."

Who plows capital into the ecosystem other than users? More of them = more available capital. More utility = more users. You still don't get it and I'm done trying... for today.  Wink

I respect your viewpoint, I just don't completely share it.
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brg444
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August 15, 2015, 01:23:07 AM
 #30542

Roll Eyes

Is AAPL competing with fiat as money?

Sorry but that's such a stupid thing to say. I'm sure you can do better than this...

Let me ask you. Did the current 1B$ ecosystem investment, equivalent billion dollar mining infrastructure, incremental userbase and increasing transactions come before or after the price increase?

Of course I'm being silly and hyperbolic, but only to illustrate that market cap isn't some "build it and they will come" metric.

There is a feedback loop between price and user growth, but it can only be sustained with growing utility.

"Yikes"

You still don't get it.

Stop thinking in terms of users. Think in terms of capital. This is not Facebook.

market cap isn't some "build it and they will come" metric.

On the contrary, when it comes to money (or networks for that matter) it seemingly works this way.

Let me borrow from the Facebook example again : create a huge network of people and they will come.

Create a huge network of money and you will attract wealth.

Look I'm not neglecting the positive added effect of these other feedback loops you are referring too. Merely downplaying their importance for the time being as some people have seemingly lost their eyes from the prize.

"When the wise man points at the moon, the fool looks at the finger."

Who plows capital into the ecosystem other than users? More of them = more available capital. More utility = more users. You still don't get it and I'm done trying... for today.  Wink

I respect your viewpoint, I just don't completely share it.

 Undecided

Quote
Think of it like this : if the 1% of the world's population who apparently controls around 40% of the world's wealth moved that money into Bitcoin it would do more to strengthen & grow the ecosystem than if 25% of the other people on earth invested all of their savings.

Chew on this one for a bit and see what comes out of it when you're done. It's not exactly a viewpoint as it's pretty much a matter of fact.


"I believe this will be the ultimate fate of Bitcoin, to be the "high-powered money" that serves as a reserve currency for banks that issue their own digital cash." Hal Finney, Dec. 2010
Cconvert2G36
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August 15, 2015, 01:36:05 AM
 #30543

Quote
Think of it like this : if the 1% of the world's population who apparently controls around 40% of the world's wealth moved that money into Bitcoin it would do more to strengthen & grow the ecosystem than if 25% of the other people on earth invested all of their savings.

Chew on this one for a bit and see what comes out of it when you're done. It's not exactly a viewpoint but pretty much matter of fact.

 Wink


I did, seems idealistic, imitating people that divide the market cap of gold by the number of bitcoins. The few top 1% wealth owners I've met seem highly unlikely to convert their entire net worth to private keys, storing m of n in various places, subject to destruction, theft, and system collapse with zero recourse.

"Large streams from little fountains flow, Tall oaks from little acorns grow."  Grin
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August 15, 2015, 01:56:53 AM
 #30544

Quote
Think of it like this : if the 1% of the world's population who apparently controls around 40% of the world's wealth moved that money into Bitcoin it would do more to strengthen & grow the ecosystem than if 25% of the other people on earth invested all of their savings.

Chew on this one for a bit and see what comes out of it when you're done. It's not exactly a viewpoint but pretty much matter of fact.

 Wink


I did, seems idealistic, imitating people that divide the market cap of gold by the number of bitcoins. The few top 1% wealth owners I've met seem highly unlikely to convert their entire net worth to private keys, storing m of n in various places, subject to destruction, theft, and system collapse with zero recourse.

"Large streams from little fountains flow, Tall oaks from little acorns grow."  Grin

You seem to make the mistake of thinking I'm proposing it as a realistic scenario. That's not what this is about. This is a thought experiment.

How exactly do you propose this work, will they have more incentives or motives to enter the system when the 80% of humanity that lives on less than $10 a day are included?

Of course in reality the scenario is orders of magnitudes smaller but the idea is the same process I describe is unfolding incrementally on a lesser scale.

Users, anyway, are not a quantifiable metric in this network, are they?


"I believe this will be the ultimate fate of Bitcoin, to be the "high-powered money" that serves as a reserve currency for banks that issue their own digital cash." Hal Finney, Dec. 2010
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August 15, 2015, 01:57:48 AM
 #30545

Not at all. It's not hard to understand really..

The thing holding other crypto back is the amount of capital people are willing to trust to them. Not necessarily the amount of users. The increasing ecosystem size is a result of capital, speculative or not, being stored into Bitcoin. As far as the nature of the speculation this is beside the point which is that Bitcoin is not used, as we speak, as a medium of exchange to purchase goods or services.

People are not buying Bitcoin because the number of transactions or users is seemingly increasing. They are buying because it attracts wealth unlike what most other coins can claim.

I've stated this repeatedly but I honestly believe it to be true: we are talking about a money protocol, a money network effect. the unit concerned is not number of users but amount of capital.

Think of it like this : if the 1% of the world's population who apparently controls around 40% of the world's wealth moved that money into Bitcoin it would do more to strengthen & grow the ecosystem than if 25% of the other people on earth invested all of their savings.

Capital flowing into Bitcoin is absolutely about expected future growth, in users, transactions, market cap, and in usefulness. Hard for me to comprehend how you can even divorce these metrics.

Remaining the domain of 10,000 geeks sitting on hordes of coins in paper wallets, occasionally trading some back and forth with each other... means failure to me. Not that it would fail to work, but that it would fail to reach its potential.  

This is not to say that user/transaction growth is some kind of panacea to be pursued at all costs, just that it shouldn't be ignored.  

Yes. And much like the others your mischaracterize the only growth we are really concerned about : market cap, or how much of the fiat economy we have absorbed. As I've said previously I couldn't care less if it comes from the pockets of the 1% or the 99%. More fiat capital trusting Bitcoin as money is exactly how it grows until it consumes all of wealth in the world.

Users, transactions are secondary. They will follow the money because like any thing worth a lot in this world people will want a piece of it. Velocity of transactions will pickup once an actual Bitcoin economy develops. Meanwhile people will hoard Bitcoin and get rid of fiat. Some might not agree but this is pretty much Gresham's law in action.

While you may not consider them "panacea to be pursued at all costs", others have outright stated this is the ONLY goal to be pursuing and that it should be done as quickly as possible. They would like to run Bitcoin like a startup. This is IMO the wrong way to go about it.

You say I mischaracterize the importance of market cap growth, I say I simply try to describe some of the forces behind market cap. Do you see a scenario where market cap goes up while the number of users, transactions, applications, and merchants... goes down?

I did not say anything about your characterization of market cap but of growth. Or more precisely, the driver of growth.

No I don't see a scenario where that happens. What I am observing though is market cap going up and users, transactions and merchants following.

So AAPL's market cap growth is a feedback loop in which it ultimately consumes the entirety of global wealth... before bitcoin! Yikes!

 Roll Eyes

Is AAPL competing with fiat as money?

Sorry but that's such a stupid thing to say. I'm sure you can do better than this...

Let me ask you. Did the current 1B$ ecosystem investment, equivalent billion dollar mining infrastructure, incremental userbase and increasing transactions come about before or after the price increase? You wouldn't argue the other way around would you?
Just so you know brg444 the market cap is not a valid metric, its a shortcut to understanding the value stored in bitcoin, its not a leading metric but a wagging tail, here oda.krell illustrates the point nicely. unfortunately the real insight was only intended for those who pay attention it's been deleted on porous :-( .

Thank me in Bits 12MwnzxtprG2mHm3rKdgi7NmJKCypsMMQw
Adrian-x
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August 15, 2015, 02:03:18 AM
 #30546

Roll Eyes

Is AAPL competing with fiat as money?

Sorry but that's such a stupid thing to say. I'm sure you can do better than this...

Let me ask you. Did the current 1B$ ecosystem investment, equivalent billion dollar mining infrastructure, incremental userbase and increasing transactions come before or after the price increase?

Of course I'm being silly and hyperbolic, but only to illustrate that market cap isn't some "build it and they will come" metric.

There is a feedback loop between price and user growth, but it can only be sustained with growing utility.

"Yikes"

You still don't get it.

Stop thinking in terms of users. Think in terms of capital. This is not Facebook.

market cap isn't some "build it and they will come" metric.

On the contrary, when it comes to money (or networks for that matter) it seemingly works this way.

Let me borrow from the Facebook example again : create a huge network of people and they will come.

Create a huge network of money and you will attract wealth.

Look I'm not neglecting the positive added effect of these other feedback loops you are referring too. Merely downplaying their importance for the time being as some people have seemingly lost their eyes from the prize.

"When the wise man points at the moon, the fool looks at the finger."

I'm not sure where your cumming from 444, but reading your comments elsewhere you seem to be bullish on bitcoin but reading your contributions here you seem oblivious to where that value comes from.

there is a nice correlation to Metacafe Law when it comes to Bitcoins value, its the best we have.

I dont think your humble enough to learn, and you defiantly overconfident enough in your ignorance to depart any wisdom.

Thank me in Bits 12MwnzxtprG2mHm3rKdgi7NmJKCypsMMQw
brg444
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August 15, 2015, 02:13:22 AM
 #30547

Not at all. It's not hard to understand really..

The thing holding other crypto back is the amount of capital people are willing to trust to them. Not necessarily the amount of users. The increasing ecosystem size is a result of capital, speculative or not, being stored into Bitcoin. As far as the nature of the speculation this is beside the point which is that Bitcoin is not used, as we speak, as a medium of exchange to purchase goods or services.

People are not buying Bitcoin because the number of transactions or users is seemingly increasing. They are buying because it attracts wealth unlike what most other coins can claim.

I've stated this repeatedly but I honestly believe it to be true: we are talking about a money protocol, a money network effect. the unit concerned is not number of users but amount of capital.

Think of it like this : if the 1% of the world's population who apparently controls around 40% of the world's wealth moved that money into Bitcoin it would do more to strengthen & grow the ecosystem than if 25% of the other people on earth invested all of their savings.

Capital flowing into Bitcoin is absolutely about expected future growth, in users, transactions, market cap, and in usefulness. Hard for me to comprehend how you can even divorce these metrics.

Remaining the domain of 10,000 geeks sitting on hordes of coins in paper wallets, occasionally trading some back and forth with each other... means failure to me. Not that it would fail to work, but that it would fail to reach its potential.  

This is not to say that user/transaction growth is some kind of panacea to be pursued at all costs, just that it shouldn't be ignored.  

Yes. And much like the others your mischaracterize the only growth we are really concerned about : market cap, or how much of the fiat economy we have absorbed. As I've said previously I couldn't care less if it comes from the pockets of the 1% or the 99%. More fiat capital trusting Bitcoin as money is exactly how it grows until it consumes all of wealth in the world.

Users, transactions are secondary. They will follow the money because like any thing worth a lot in this world people will want a piece of it. Velocity of transactions will pickup once an actual Bitcoin economy develops. Meanwhile people will hoard Bitcoin and get rid of fiat. Some might not agree but this is pretty much Gresham's law in action.

While you may not consider them "panacea to be pursued at all costs", others have outright stated this is the ONLY goal to be pursuing and that it should be done as quickly as possible. They would like to run Bitcoin like a startup. This is IMO the wrong way to go about it.

You say I mischaracterize the importance of market cap growth, I say I simply try to describe some of the forces behind market cap. Do you see a scenario where market cap goes up while the number of users, transactions, applications, and merchants... goes down?

I did not say anything about your characterization of market cap but of growth. Or more precisely, the driver of growth.

No I don't see a scenario where that happens. What I am observing though is market cap going up and users, transactions and merchants following.

So AAPL's market cap growth is a feedback loop in which it ultimately consumes the entirety of global wealth... before bitcoin! Yikes!

 Roll Eyes

Is AAPL competing with fiat as money?

Sorry but that's such a stupid thing to say. I'm sure you can do better than this...

Let me ask you. Did the current 1B$ ecosystem investment, equivalent billion dollar mining infrastructure, incremental userbase and increasing transactions come about before or after the price increase? You wouldn't argue the other way around would you?
Just so you know brg444 the market cap is not a valid metric, its a shortcut to understanding the value stored in bitcoin, its not a leading metric but a wagging tail, here oda.krell illustrates the point nicely. unfortunately the real insight was only intended for those who pay attention it's been deleted on porous :-( .

While that is a perfectly valid observation. Market cap is at least the most precise indicator of historic growth in the value of network we have at hand.

Not users, not nodes, not transactions.

"I believe this will be the ultimate fate of Bitcoin, to be the "high-powered money" that serves as a reserve currency for banks that issue their own digital cash." Hal Finney, Dec. 2010
brg444
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August 15, 2015, 02:27:20 AM
 #30548

Roll Eyes

Is AAPL competing with fiat as money?

Sorry but that's such a stupid thing to say. I'm sure you can do better than this...

Let me ask you. Did the current 1B$ ecosystem investment, equivalent billion dollar mining infrastructure, incremental userbase and increasing transactions come before or after the price increase?

Of course I'm being silly and hyperbolic, but only to illustrate that market cap isn't some "build it and they will come" metric.

There is a feedback loop between price and user growth, but it can only be sustained with growing utility.

"Yikes"

You still don't get it.

Stop thinking in terms of users. Think in terms of capital. This is not Facebook.

market cap isn't some "build it and they will come" metric.

On the contrary, when it comes to money (or networks for that matter) it seemingly works this way.

Let me borrow from the Facebook example again : create a huge network of people and they will come.

Create a huge network of money and you will attract wealth.

Look I'm not neglecting the positive added effect of these other feedback loops you are referring too. Merely downplaying their importance for the time being as some people have seemingly lost their eyes from the prize.

"When the wise man points at the moon, the fool looks at the finger."

I'm not sure where your cumming from 444, but reading your comments elsewhere you seem to be bullish on bitcoin but reading your contributions here you seem oblivious to where that value comes from.

there is a nice correlation to Metacafe Law when it comes to Bitcoins value, its the best we have.

I dont think your humble enough to learn, and you defiantly overconfident enough in your ignorance to depart any wisdom.

Is that so? I do remember Raystonn used to project the value of the network using Unique Addresses^2. Peter R had his own transactions version. That seemed like it could work back in 2014. In both cases I believe we've seen at least 100% increases while the market cap has not quite followed.

I'm curious what both charts would look right about now but I'm afraid it would invalidate both theories. The reason might be that no one knows exactly how to quantify the amount of users in the network.

"I believe this will be the ultimate fate of Bitcoin, to be the "high-powered money" that serves as a reserve currency for banks that issue their own digital cash." Hal Finney, Dec. 2010
n2004al
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August 15, 2015, 02:39:11 AM
 #30549

Every intimation that put gold in front of bitcoin is a pure speculation. Are separate entities that have totally different duties. It is enough to tell that gold is not currencies (and never will be) and that bitcoin is currency (even not full as such by some) and maybe will be a reserve toll. Being totally different make them incomparable. So put in one thread both of them with the intent to compare those with each other is not correct in my point of view.

brg444
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August 15, 2015, 02:45:21 AM
 #30550

Every intimation that put gold in front of bitcoin is a pure speculation. Are separate entities that have totally different duties. It is enough to tell that gold is not currencies (and never will be) and that bitcoin is currency (even not full as such by some) and maybe will be a reserve toll. Being totally different make them incomparable. So put in one thread both of them with the intent to compare those with each other is not correct in my point of view.

Bitcoin picked up gold's duty which it could never successfully fulfill anyway.

You haven't been paying any attention if you actually attempt to step into this thread and claim with any credibility that gold and Bitcoin are totally different?

"I believe this will be the ultimate fate of Bitcoin, to be the "high-powered money" that serves as a reserve currency for banks that issue their own digital cash." Hal Finney, Dec. 2010
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August 15, 2015, 02:50:10 AM
 #30551

Not at all. It's not hard to understand really..

The thing holding other crypto back is the amount of capital people are willing to trust to them. Not necessarily the amount of users. The increasing ecosystem size is a result of capital, speculative or not, being stored into Bitcoin. As far as the nature of the speculation this is beside the point which is that Bitcoin is not used, as we speak, as a medium of exchange to purchase goods or services.

People are not buying Bitcoin because the number of transactions or users is seemingly increasing. They are buying because it attracts wealth unlike what most other coins can claim.

I've stated this repeatedly but I honestly believe it to be true: we are talking about a money protocol, a money network effect. the unit concerned is not number of users but amount of capital.

Think of it like this : if the 1% of the world's population who apparently controls around 40% of the world's wealth moved that money into Bitcoin it would do more to strengthen & grow the ecosystem than if 25% of the other people on earth invested all of their savings.

Capital flowing into Bitcoin is absolutely about expected future growth, in users, transactions, market cap, and in usefulness. Hard for me to comprehend how you can even divorce these metrics.

Remaining the domain of 10,000 geeks sitting on hordes of coins in paper wallets, occasionally trading some back and forth with each other... means failure to me. Not that it would fail to work, but that it would fail to reach its potential.  

This is not to say that user/transaction growth is some kind of panacea to be pursued at all costs, just that it shouldn't be ignored.  

Yes. And much like the others your mischaracterize the only growth we are really concerned about : market cap, or how much of the fiat economy we have absorbed. As I've said previously I couldn't care less if it comes from the pockets of the 1% or the 99%. More fiat capital trusting Bitcoin as money is exactly how it grows until it consumes all of wealth in the world.

Users, transactions are secondary. They will follow the money because like any thing worth a lot in this world people will want a piece of it. Velocity of transactions will pickup once an actual Bitcoin economy develops. Meanwhile people will hoard Bitcoin and get rid of fiat. Some might not agree but this is pretty much Gresham's law in action.

While you may not consider them "panacea to be pursued at all costs", others have outright stated this is the ONLY goal to be pursuing and that it should be done as quickly as possible. They would like to run Bitcoin like a startup. This is IMO the wrong way to go about it.

You say I mischaracterize the importance of market cap growth, I say I simply try to describe some of the forces behind market cap. Do you see a scenario where market cap goes up while the number of users, transactions, applications, and merchants... goes down?

I did not say anything about your characterization of market cap but of growth. Or more precisely, the driver of growth.

No I don't see a scenario where that happens. What I am observing though is market cap going up and users, transactions and merchants following.

So AAPL's market cap growth is a feedback loop in which it ultimately consumes the entirety of global wealth... before bitcoin! Yikes!

 Roll Eyes

Is AAPL competing with fiat as money?

Sorry but that's such a stupid thing to say. I'm sure you can do better than this...

Let me ask you. Did the current 1B$ ecosystem investment, equivalent billion dollar mining infrastructure, incremental userbase and increasing transactions come about before or after the price increase? You wouldn't argue the other way around would you?
Just so you know brg444 the market cap is not a valid metric, its a shortcut to understanding the value stored in bitcoin, its not a leading metric but a wagging tail, here oda.krell illustrates the point nicely. unfortunately the real insight was only intended for those who pay attention it's been deleted on porous :-( .

While that is a perfectly valid observation. Market cap is at least the most precise indicator of historic growth in the value of network we have at hand.

Not users, not nodes, not transactions.

your 66% wrong but I'm unwilling to prove it and so are all the other hoarders, but to help you understand, if Satoshy had to sell 20% of his bitcoin holdings, that's roughly 1% of the market cap (an estimates 1,000,000 BTC belonging to Satoshi) the total market cap would drop from about $3.8Bto a generous guesstimate of $140M at around $10 per BTC.

So as you can see selling 1% of Bitcoin has a distorting ability to reduce the market cap by a whopping 96.23% (and this is the metric you feel is the most accurate metric to measure bitcoin's value and growth?)

So in other words if Satoshi tried to liquidate 20% of his holdings he would reduce the value of the remaining 80% by about 99.62%. the reason big holders are holding is because of game theory, market cap is not the metric invested interests are watching, its a mirage.  

Thank me in Bits 12MwnzxtprG2mHm3rKdgi7NmJKCypsMMQw
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August 15, 2015, 02:59:36 AM
 #30552

Roll Eyes

Is AAPL competing with fiat as money?

Sorry but that's such a stupid thing to say. I'm sure you can do better than this...

Let me ask you. Did the current 1B$ ecosystem investment, equivalent billion dollar mining infrastructure, incremental userbase and increasing transactions come before or after the price increase?

Of course I'm being silly and hyperbolic, but only to illustrate that market cap isn't some "build it and they will come" metric.

There is a feedback loop between price and user growth, but it can only be sustained with growing utility.

"Yikes"

You still don't get it.

Stop thinking in terms of users. Think in terms of capital. This is not Facebook.

market cap isn't some "build it and they will come" metric.

On the contrary, when it comes to money (or networks for that matter) it seemingly works this way.

Let me borrow from the Facebook example again : create a huge network of people and they will come.

Create a huge network of money and you will attract wealth.

Look I'm not neglecting the positive added effect of these other feedback loops you are referring too. Merely downplaying their importance for the time being as some people have seemingly lost their eyes from the prize.

"When the wise man points at the moon, the fool looks at the finger."

I'm not sure where your cumming from 444, but reading your comments elsewhere you seem to be bullish on bitcoin but reading your contributions here you seem oblivious to where that value comes from.

there is a nice correlation to Metacafe Law when it comes to Bitcoins value, its the best we have.

I dont think your humble enough to learn, and you defiantly overconfident enough in your ignorance to depart any wisdom.

Is that so? I do remember Raystonn used to project the value of the network using Unique Addresses^2. Peter R had his own transactions version. That seemed like it could work back in 2014. In both cases I believe we've seen at least 100% increases while the market cap has not quite followed.

I'm curious what both charts would look right about now but I'm afraid it would invalidate both theories. The reason might be that no one knows exactly how to quantify the amount of users in the network.

there is a lot of standard deviation but I dont think it is outside of the mean, If i was to give it my humble 0.02BTC guess, i think Blockstream have done bitcoin a big favor by threatening to introduce Sidechains, it adds a lot of uncertainty to the projected success of bitcoin, that's given many investors an opportunity to buy in during this downturn and forced large holders let coins go.

I for one believe the depressed growth in price is largely influenced by the risk of bitcoin failure, and i suspect we'll see a lot of action when we get new information and certainty on Block size.

Thank me in Bits 12MwnzxtprG2mHm3rKdgi7NmJKCypsMMQw
brg444
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August 15, 2015, 03:07:19 AM
 #30553

Not at all. It's not hard to understand really..

The thing holding other crypto back is the amount of capital people are willing to trust to them. Not necessarily the amount of users. The increasing ecosystem size is a result of capital, speculative or not, being stored into Bitcoin. As far as the nature of the speculation this is beside the point which is that Bitcoin is not used, as we speak, as a medium of exchange to purchase goods or services.

People are not buying Bitcoin because the number of transactions or users is seemingly increasing. They are buying because it attracts wealth unlike what most other coins can claim.

I've stated this repeatedly but I honestly believe it to be true: we are talking about a money protocol, a money network effect. the unit concerned is not number of users but amount of capital.

Think of it like this : if the 1% of the world's population who apparently controls around 40% of the world's wealth moved that money into Bitcoin it would do more to strengthen & grow the ecosystem than if 25% of the other people on earth invested all of their savings.

Capital flowing into Bitcoin is absolutely about expected future growth, in users, transactions, market cap, and in usefulness. Hard for me to comprehend how you can even divorce these metrics.

Remaining the domain of 10,000 geeks sitting on hordes of coins in paper wallets, occasionally trading some back and forth with each other... means failure to me. Not that it would fail to work, but that it would fail to reach its potential.  

This is not to say that user/transaction growth is some kind of panacea to be pursued at all costs, just that it shouldn't be ignored.  

Yes. And much like the others your mischaracterize the only growth we are really concerned about : market cap, or how much of the fiat economy we have absorbed. As I've said previously I couldn't care less if it comes from the pockets of the 1% or the 99%. More fiat capital trusting Bitcoin as money is exactly how it grows until it consumes all of wealth in the world.

Users, transactions are secondary. They will follow the money because like any thing worth a lot in this world people will want a piece of it. Velocity of transactions will pickup once an actual Bitcoin economy develops. Meanwhile people will hoard Bitcoin and get rid of fiat. Some might not agree but this is pretty much Gresham's law in action.

While you may not consider them "panacea to be pursued at all costs", others have outright stated this is the ONLY goal to be pursuing and that it should be done as quickly as possible. They would like to run Bitcoin like a startup. This is IMO the wrong way to go about it.

You say I mischaracterize the importance of market cap growth, I say I simply try to describe some of the forces behind market cap. Do you see a scenario where market cap goes up while the number of users, transactions, applications, and merchants... goes down?

I did not say anything about your characterization of market cap but of growth. Or more precisely, the driver of growth.

No I don't see a scenario where that happens. What I am observing though is market cap going up and users, transactions and merchants following.

So AAPL's market cap growth is a feedback loop in which it ultimately consumes the entirety of global wealth... before bitcoin! Yikes!

 Roll Eyes

Is AAPL competing with fiat as money?

Sorry but that's such a stupid thing to say. I'm sure you can do better than this...

Let me ask you. Did the current 1B$ ecosystem investment, equivalent billion dollar mining infrastructure, incremental userbase and increasing transactions come about before or after the price increase? You wouldn't argue the other way around would you?
Just so you know brg444 the market cap is not a valid metric, its a shortcut to understanding the value stored in bitcoin, its not a leading metric but a wagging tail, here oda.krell illustrates the point nicely. unfortunately the real insight was only intended for those who pay attention it's been deleted on porous :-( .

While that is a perfectly valid observation. Market cap is at least the most precise indicator of historic growth in the value of network we have at hand.

Not users, not nodes, not transactions.

your 66% wrong but I'm unwilling to prove it and so are all the other hoarders, but to help you understand, if Satoshy had to sell 20% of his bitcoin holdings, that's roughly 1% of the market cap (an estimates 1,000,000 BTC belonging to Satoshi) the total market cap would drop from about $3.8Bto a generous guesstimate of $140M at around $10 per BTC.

So as you can see selling 1% of Bitcoin has a distorting ability to reduce the market cap by a whopping 96.23% (and this is the metric you feel is the most accurate metric to measure bitcoin's value and growth?)

So in other words if Satoshi tried to liquidate 20% of his holdings he would reduce the value of the remaining 80% by about 99.62%. the reason big holders are holding is because of game theory, market cap is not the metric invested interests are watching, its a mirage.  

For how long?

From what I understand the issue you are describing is a lack of liquidity in the market and poor information on actual trades. With time this supply will be absorbed by the market until equilibrium is reached again.

I do appreciate the point you are making and it is true that as it stands the price signal is not necessarily clear enough to make it a valid indicator of the network value. Price discovery still?

I'm not sure why your strokethrough "nodes" though. I don't see any way you could suggest they are somewhat an indicator of network growth...

"I believe this will be the ultimate fate of Bitcoin, to be the "high-powered money" that serves as a reserve currency for banks that issue their own digital cash." Hal Finney, Dec. 2010
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August 15, 2015, 03:16:03 AM
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...Peter R had his own transactions version. That seemed like it could work back in 2014. In both cases I believe we've seen at least 100% increases while the market cap has not quite followed.

I'm curious what both charts would look right about now but I'm afraid it would invalidate both theories. The reason might be that no one knows exactly how to quantify the amount of users in the network.

Sure.



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Brg444, what do you think of my last response to your comment about moving the block size limit out of the consensus layer?

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August 15, 2015, 03:19:16 AM
 #30555

...Peter R had his own transactions version. That seemed like it could work back in 2014. In both cases I believe we've seen at least 100% increases while the market cap has not quite followed.

I'm curious what both charts would look right about now but I'm afraid it would invalidate both theories. The reason might be that no one knows exactly how to quantify the amount of users in the network.

Sure.



 Wink

Brg444, what do you think of my last response to your comment about moving the block size limit out of the consensus layer?

It is an interesting idea but I'm still thinking it through. Should get you a reply by this weekend.

"I believe this will be the ultimate fate of Bitcoin, to be the "high-powered money" that serves as a reserve currency for banks that issue their own digital cash." Hal Finney, Dec. 2010
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August 15, 2015, 03:54:20 AM
 #30556

...Peter R had his own transactions version. That seemed like it could work back in 2014. In both cases I believe we've seen at least 100% increases while the market cap has not quite followed.

I'm curious what both charts would look right about now but I'm afraid it would invalidate both theories. The reason might be that no one knows exactly how to quantify the amount of users in the network.

Sure.



 Wink

Brg444, what do you think of my last response to your comment about moving the block size limit out of the consensus layer?

It is an interesting idea but I'm still thinking it through. Should get you a reply by this weekend.

As a quick thought: I'm worried about centralization issue. (yes :/)

First thought is what you are proposing could effectively creates an arm race in mining and node connectivity which will most likely prove to be out of reach of regular users.

Possibly centralizing these nodes farms & miners geographically because of internet politics.


"I believe this will be the ultimate fate of Bitcoin, to be the "high-powered money" that serves as a reserve currency for banks that issue their own digital cash." Hal Finney, Dec. 2010
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August 15, 2015, 05:48:08 AM
 #30557

...Peter R had his own transactions version. That seemed like it could work back in 2014. In both cases I believe we've seen at least 100% increases while the market cap has not quite followed.

I'm curious what both charts would look right about now but I'm afraid it would invalidate both theories. The reason might be that no one knows exactly how to quantify the amount of users in the network.

Sure.



 Wink


You are a master at decorating a plot with arbitrary fluff as though it means something.  I still LOL at the color one you did and how you 'updated' it.  It still blows my mind that there were so many mouth-breathers panicing because 'we are so close to the red'.

In this plot, the trends are mildly non-linear _against_ the point you are trying (probably successfully) to make.  And there was no particular block size pressure at the arbitrary point where you choose to point the arrow.

Let me propose a different read.  I currently own way more BTC than I would buy if I were taking a position at this point in time.  They are left over from when the price was lower and there is a fair amount of risk and cost in balancing so I sit tight.  If I needed a place to sink a windfall in cash, it would certainly be favorably distributed toward PM's and that is much more the case because you guys are trying to destroy Bitcoin in the way that it is valuable to me.  Unclear if you will succeed, but it's a very large risk point.  Anyway, I'll bet that there are many many other people in my situation.  We can expect the trend to continue until a balance between Bitcoin's fairly high inflation rate and the desire to hodl Bitcoin match.  Of course all manner of factors can shift the 'propensity to hodl' so it is not going to be some sort of stable point for a long long time and maybe never.

If you Bloatchainers were designing aircraft, the 747 would have 1/2 inch cable attached directly from the pilot's yoke to the elevator just like the ultralight were such a thing works quite well.  The idea of a trim-tab would never have been thought of.  Nor would the aircraft be able to be controlled.  I think that about the only bloatcoiner smart enough to see this clearly is Mike Hearn, and that is exactly why he has put in the effort to make XT.  Classic controlled demolition.


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August 15, 2015, 06:19:51 AM
 #30558

...Peter R had his own transactions version. That seemed like it could work back in 2014. In both cases I believe we've seen at least 100% increases while the market cap has not quite followed.

I'm curious what both charts would look right about now but I'm afraid it would invalidate both theories. The reason might be that no one knows exactly how to quantify the amount of users in the network.

Sure.



 Wink


You are a master at decorating a plot with arbitrary fluff as though it means something.  I still LOL at the color one you did and how you 'updated' it.  It still blows my mind that there were so many mouth-breathers panicing because 'we are so close to the red'.

In this plot, the trends are mildly non-linear _against_ the point you are trying (probably successfully) to make.  And there was no particular block size pressure at the arbitrary point where you choose to point the arrow.

Let me propose a different read.  I currently own way more BTC than I would buy if I were taking a position at this point in time.  They are left over from when the price was lower and there is a fair amount of risk and cost in balancing so I sit tight.  If I needed a place to sink a windfall in cash, it would certainly be favorably distributed toward PM's and that is much more the case because you guys are trying to destroy Bitcoin in the way that it is valuable to me.  Unclear if you will succeed, but it's a very large risk point.  Anyway, I'll bet that there are many many other people in my situation.  We can expect the trend to continue until a balance between Bitcoin's fairly high inflation rate and the desire to hodl Bitcoin match.  Of course all manner of factors can shift the 'propensity to hodl' so it is not going to be some sort of stable point for a long long time and maybe never.

If you Bloatchainers were designing aircraft, the 747 would have 1/2 inch cable attached directly from the pilot's yoke to the elevator just like the ultralight were such a thing works quite well.  The idea of a trim-tab would never have been thought of.  Nor would the aircraft be able to be controlled.  I think that about the only bloatcoiner smart enough to see this clearly is Mike Hearn, and that is exactly why he has put in the effort to make XT.  Classic controlled demolition.



Sounds like a bearish bitcoin post.

Am I right?

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August 15, 2015, 06:34:03 AM
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Sounds like a bearish bitcoin post.

Am I right?

Not exactly.  I'd still buy BTC if I had none, but I'd buy more gold.  This ratio is 'bearish' for Bitcoin very much because of the futility and destructive potential of trying to make it scale via stone-ax methods and the traction that idea seems to have here in Tardville.

I would add that I could see making gob-smacks of money in the (likely) eventuality that Google-class operators decide to adopt it and make it into Paypal-II (rather than just kill it off.)  That certainly could happen and the world is full of idiots so it just might fly pretty high.  They supporting it is probably the best bet to keep more dangerous related technologies from getting a foot-hold.  That doesn't make me 'bullish' really though I won't turn down the offer to capitalize handsomely should the opportunity present itself.


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August 15, 2015, 06:45:45 AM
 #30560

the only bloatcoiner smart enough to see this clearly is Mike Hearn, and that is exactly why he has put in the effort to make XT.  Classic controlled demolition.

Excellent (and blessedly succinct) argument by analogy.  "Hostile/malicious fork" descriptive power just doesn't have the same je ne sais quoi as "controlled demolition."

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Bitcoin is intentionally designed to be ungovernable and governance-free.  luke-jr 2016

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