Don't rely on Venture capital money - these guys don't know what they're doing

[minerpumpkin]

Some people don't, but others do actually see things where others don't. A lot of those people wouldn't even have all the money they do, if they weren't somehow apt at judging opportunities and making the right decisions at the right time - even (or especially!) when others tell them they're wrong in their actions.

[tvbcof]

Nobody answered my question tho.

Why should the average Joe buy bitcoin? For what purposes?

Back when Bitcoin was in the low single digits, I argued that the average Joe who could afford to might pick some Bitcoin as a long-shot bet just in case because the pay-off, in the relatively unlikely event that there was one, could be large.

Also for the reasons of reward size, that the actual amount of BTC need not be very large in order to make things pay off in a moderate to good scenario.

At $1000, we were approaching what I considered the 'moderate win' scenario.  I took some profits and re-balanced my portfolio there which was in-line with the plan I made when I was buying.

Different times now.  I'd not make any suggestions at this point.  Personally I would still probably make a modest bet today if I had a strong desire to diversify.

That is still "speculative reasons".

yeah.  So?  That as good a reason as any and a better reason than most for people to buy BTC.  As long as they are willing to put in the effort required to know how to hold on to them.

The average Joe wants something that is useful, that has a purpose, if the only purpose is "I will get more dollars when I will be able to sell it higher" (IF it goes higher), that is not gonna work to bring "world adoption" to bitcoin.

The average Joe wants to make money just like everyone else.  'World adoption' is the worst idea ever for Bitcoin.  Indeed, efforts in that direction were a driving force inducing me to sell more a year ago when I was doing that.

As I explained, there really isn't any point for the average joe to actually use bitcoin as a currency or as a store of value, aside from illicit activities.
The only real reason seems to be musical-chairs speculation as an end in itself, and that is not exactly something the average joe might know how to do profitably or be interested in in the first place.

'Illicit' is, I suppose, defined as anything that corp/gov doesn't like.  And they like very little that gets in the way of their crony relationships with one another.  So as far as I'm concerned when it comes to 'illicit activities', bring it on.  There are lots of ways to catch crooks who do bad things.  I'm not inclined to give away every freedom I have, or every possible way to express dis-satisfaction with the corruption in the system just so some fat ass cop can 'do his job' without doing any real work.

I've never favored being anything but completely straight-up with Mr A. V. E. Joe about Bitcoin and have never personally done so.  There are absolutely risks and the very nature of the solution is not clear in part because it is different things to different people.  If Joe want's to take the time to figure things out, I'm OK with that.  Some Joe Sixpack types end up being a fair bit more competent than many self-garlanded 'experts' if they take an interest in applying themselves.

[tabnloz]

I see a $75m investment as a positive. Not all VC investments make money, that much is widely acknowledged, and using the Dotcom bubble example, the ones that invested on the back of hype and minimal understanding of a new technology were burnt ie, I have an idea and a domain name but no product as yet, no proven sales = here have $10m. Perhaps 2014 was Bitcoin's dotcom burst.

But this is not what I see with Coinbase. I see some people in an industry that may be disintermediated making a bridging play. Sure, they aren't investing in btc directly, because at the moment it is volatile, in a bear market and there are security issues. Despite this, they've collectively put $75m into one of the major players in the space. If bitcoin grows and becomes a financial force then Coinbase will be valued much much higher than the valuation at which they invested. That's a VC play. I think that is their play.

Coinbase has potential to grow and offer other services. They have well respected VC's on their board and Gavin Andressen as an advisor. No guarantee of success but good odds. They also are pro-regulation and would probably become the go-to business for Wall St types to use. They could be the digital clearinghouse as Oda said upthread. I'd say this would see them merge or be acquired by a company worth many times Bitcoins market cap

The NYDFS hasn't spent the last year working on BitLicenses because Beaniebabies, I would assume their research and other contributors see some kind of use for Blockchain / Bitcoin.

[oda.krell]

To return to my dotcom bubble analogy, yes, bitcoin = world.com, pets.com

(Partly) quoting my response from the wall thread...

I can't be arsed to take this discussion any more serious than I do until you come up with some more insightful comparisons than "Bitcoin = pets.com". Same idea as the claims that "Bitcoin = tulip bubble" or "Bitcoin = beanie babies".

There's really no point in arguing with someone who equates a major technological achievement that has half of the computer science world and a few percent of the economical world excited with an online store for pet food, even if both of them underwent a speculative mania phase.

"VC doesn't really invest in bitcoin the currency."

We know that. But they invest in Bitcoin infrastructure. If you consider that to be bearish, long-term, be my guest.


"Big money invested during the dotcom bubble as well. Shows how stupid they were."

Hardly. Unless they went all-in on pets.com, they made out like bandits in the longer run.


"But that's exactly what Bitcoin is! Pets.com."

Well, yeah. That's just, like, your opinion, man. Just as an example, I don't remember major CS departments all around the world getting all excited about pets.com, introducing courses on the pets.com technology, theses being written about the intricacies of pets.com.

But you probably fail to see the significance in that. Which is fine. That's where my speculative profits come from.

[NotLambchop]

...
I can't be arsed to take this discussion any more serious than I do until you come up with some more insightful comparisons than "Bitcoin = pets.com"...

Beanie Babies?
*ducks*

[NotHatinJustTrollin]

I can't be arsed to take this discussion any more serious than I do until you come up with some more insightful comparisons than "Bitcoin = pets.com". Same idea as the claims that "Bitcoin = tulip bubble" or "Bitcoin = beanie babies".

There's really no point in arguing with someone who equates a major technological achievement that has half of the computer science world and a few percent of the economical world excited with an online store for pet food, even if both of them underwent a speculative mania phase.

I don't see why not, the analogy works as a distinction between a bubble and the actual revolutionary technological advancement (which is not "bitcoin VS the blockchain" but "bitcoin VS a distributed ledger technology that makes sense").

"major technological achievement that has half of the computer science world excited"
Not sure about that claim. There are a lot of computer scientists who are either bashing it or at least acknowledging its big limitations (while admitting that the underlying idea behind the technology is worth it and actually revolutionary, but the blockchain implementation might not the the best one).
Same with the "few percent of the economic world". Are you sure you are not biased with these claims?


I'm not saying crypto or distributed ledger technologies are a fad. I'm saying that the bitcoin blockchain implementation and especially the idea of a stand-alone currency that is needed in the system is probably a fad.

[NotHatinJustTrollin]

My main question still remained unanswered:

If there is no guarantee that the bitcoin's price is gonna go up and allow the average Joe to profit from it, why should he buy bitcoin to use it as a currency?

[inca]

I'm not saying crypto or distributed ledger technologies are a fad. I'm saying that the bitcoin blockchain implementation and especially the idea of a stand-alone currency that is needed in the system is probably a fad.

A fad on the WSJ front page still getting tens of millions of dollars of VC funding this month alone, after 6 years?!

If it is a fad why are you here on a Sunday?

[NotHatinJustTrollin]

I'm not saying crypto or distributed ledger technologies are a fad. I'm saying that the bitcoin blockchain implementation and especially the idea of a stand-alone currency that is needed in the system is probably a fad.

A fad on the WSJ front page still getting tens of millions of dollars of VC funding this month alone, after 6 years?!

If it is a fad why are you here on a Sunday?

Have you actually read the WSJ article? Very superficial understanding about bitcoin and the blockchain.
Plenty of hype articles during 2014 right before crashes too.

[inca]

I'm not saying crypto or distributed ledger technologies are a fad. I'm saying that the bitcoin blockchain implementation and especially the idea of a stand-alone currency that is needed in the system is probably a fad.

A fad on the WSJ front page still getting tens of millions of dollars of VC funding this month alone, after 6 years?!

If it is a fad why are you here on a Sunday?

Have you actually read the WSJ article? Very superficial understanding about bitcoin and the blockchain.
Plenty of hype articles during 2014 right before crashes too.

This is after an 87% crash

[BTCtrader71]

My main question still remained unanswered:

If there is no guarantee that the bitcoin's price is gonna go up and allow the average Joe to profit from it, why should he buy bitcoin to use it as a currency?

Average Joe should use it for all of his online purchases through Amazon, Best Buy, Target, any retailer who sells gift cards through gyft.com. Why?
Because Joe gets 3% discount for using bitcoin, that's why. And Joe can insulate himself completely from bitcoin price fluctuations by converting USD->BTC at the time of purchase at a place like coinbase.

[BTCtrader71]

Maybe you don't believe bitcoin has a future, but Coinbase just got 75 million votes to the contrary.
...

Again:  Coinbase is not Bitcoin.  If someone wants to invest in USD, they don't invest in PayPal, they buy USD.

Name one, really, just one large company (other than the producer) investing in Beanie Babies infrastructure - one of your favorite analogies for Bitcoin.

If I am not mistaken, I believe that Amazon's original business plan was to build a $75 million platform designed specifically (and solely) to profit from people cashing out their Beenie Baby investment.

[oda.krell]

Name one, really, just one large company (other than the producer) investing in Beanie Babies infrastructure - one of your favorite analogies for Bitcoin.

If I am not mistaken, I believe that Amazon's original business plan was to build a $75 million platform designed specifically (and solely) to profit from people cashing out their Beenie Baby investment.

[NotLambchop]

Maybe you don't believe bitcoin has a future, but Coinbase just got 75 million votes to the contrary.
...

Again:  Coinbase is not Bitcoin.  If someone wants to invest in USD, they don't invest in PayPal, they buy USD.

Name one, really, just one large company (other than the producer) investing in Beanie Babies infrastructure - one of your favorite analogies for Bitcoin.

If I am not mistaken, I believe that Amazon's original business plan was to build a $75 million platform designed specifically (and solely) to profit from people cashing out their Beenie Baby investment.

You're mistaken on so many levels, hard to choose where to start.
I'll assume that by BTCeanie BTCabies you meant Bitcoin.  No biggie, many still confuse the two--not going to take offense or dwell on that any longer.  To the chase: Amazon didn't invest $75 million in either Bitcoin or Coinbase, $75 million is the total raised by coinbase.  Amazon's just one of the "investors."

What i do find offensive is your implications of some sort of a mass divestment from BTCeanies.  No one in his right mind is "cashing out their Beenie [sic] Baby investment."  True, some weak hands are being shaken out, but serious people with understanding of BTCeanie BTCabies technology are increasing their BTCeanie holdings, secretly.

If you was good with investing, you'd know that BTCeanie BTCabies is a long-term investment, not some overhyped internet get-rich-quick scheme like Bitcoin.
The fundamentals are improving all the time, don't miss the rocketboat.

  ~Happy Investing!

[mtwelve]

im so confused if Bitcoin and BTCeanies are the same thing lol I feel like an idiot

[NotHatinJustTrollin]

My main question still remained unanswered:

If there is no guarantee that the bitcoin's price is gonna go up and allow the average Joe to profit from it, why should he buy bitcoin to use it as a currency?

Average Joe should use it for all of his online purchases through Amazon, Best Buy, Target, any retailer who sells gift cards through gyft.com. Why?
Because Joe gets 3% discount for using bitcoin, that's why. And Joe can insulate himself completely from bitcoin price fluctuations by converting USD->BTC at the time of purchase at a place like coinbase.

I had already answered to that:

Why should the average Joe buy bitcoin and use it as a currency, if he is not interested in the use cases I just mentioned?

-because no fees? Volatility can fuck that over real good, so no point in saving 1-3% when you can lose 10-30% in a few days. You might argue that over time (IF bitcoin succeeds) volatility will gradually decrease. While I have doubts about that, in the long run bitcoin transaction fees will be higher anyway. I guess you know that miners “need to be paid” in order for bitcoin and the blockchain to exist, whether thanks to ridiculous inflation, or transaction fees. The blockchain is not gratis.
Peter Todd said it himself: “regarding fee economics, we’re fucked”.

For similar network security, we are either getting ridiculous monetary inflation or higher transaction fees.

On top of that I seriously doubt the average joe cares about going through the pain in the ass to get involved with bitcoin only to save 1-3% (right now that high bitcoin monetary inflation allows it) for the stuff he has to buy online.
If you convert BTC to USD to avoid volatility you pay fees for that too (less, but still). And if you buy bitcoin just to convert it to USD right after to avoid volatility and if you buy BTC only when you intend to spend it online that doesn't add any demand pushing the price up, since the merchants just dump the BTC anyway.


In other words, the whole system as a currency is a mess, especially long term.