Just how good is Crypto-currency?

[RainCaster]

Here's an interesting op-ed in a rather respected tech mag about "just how useful is blockchain"? The author draws some interesting conclusions.

The dark equation of harm versus good means blockchain’s had its day

The underlying technology of Bitcoin, the distributed ledger of the blockchain, is undeniably cool and dangerously seductive to intellectual types. A tamper-proof public database that needs no central control and is both transparent and anonymous, it entranced mathematicians and computer scientists. It seemed then and still seems now that something that clever must be useful for something.

Now we know what that is. Cybercurrency, by dint of eschewing central control, is terribly useful for transferring value outside the banking system. Early boosters said that this would reduce costs and increase flexibility so that you could and would be using it to buy things in corner shops, foreshadowing a future where it, like the laser, was a ubiquitous component of the retail experience.

That hasn't happened. Instead, it is at the heart of a $20bn a year world-wide extortion racket. Ransomware, that insanely profitable mega-heist, uses many techniques and is constantly developing, but it is utterly reliant on cryptocurrency to be worthwhile.

Cybercurrency does have a role in specialist retail too, the sort where drugs, weaponry, fake ID, hacking data stashes and dubious services are traded by the internet's demimonde: There is certainly an argument for an open trade in recreational drugs, but not like this.

[ColinC]

1. It's a solid gamble, though.

Might even make a few bucks in the process. Or lose your life savings

[ProfessorGAC]

2. Hence The Word "Gamble"

And, most financial experts make a distinction between investing & gambling!

[ColinC]

4. I will point out, however, that as crytpos are becoming integrated into certain investmentportfolios

along with other high risk speculative "investments," the contrast becomes quite small between the more accepted high risk speculative investments and the crypto world. As it is of course a high risk speculative investment similar to many penny stocks, etc.

[ProfessorGAC]

6. I Don't Doubt That At All

I still have my reservations based upon the lack of intrinsic value.
Stocks, while sometimes irrationally inflated (like Tesla with $58 billion in assets but a trillion in equity), still have some hard asset value.
I'm unconvinced that crypto has any intrinsic value, which makes those investments more like letting it roll and hoping 7 or 11 come up.
If people get out when they hit some substantial mark for ROI, good for them. But, I fear those in early will make a fortune and those late arrivals will get killed when the correction to true value occurs. May never occur, but I doubt that will be the outcome.

[GregariousGroundhog]

8. Bitcoin doesn't have any more or any less intrinsic value than fiat issued by a central government

Just like there are people who make money betting that the euro, the yen, or the renminbi will go up or down against the dollar, there are people who bet BitCoin will go up or go down against the dollar.

Holding Bitcoin can make sense as a storage of wealth for someone who lives in countries experiencing double digit inflation in their local currency. It can also make sense for people who have maleficent motives. Bitcoin brings can bring out both good and bad.

[ProfessorGAC]

9. We Disagree On That

That's ok.
But, fiat currency has the strength of a true exchange market supporting it, even if privately held by millions of shareholders.
So, I don't think the intrinsic value statement is accurate. You do.
We don't have to agree on everything. That's why we're not conservatives.

[ColinC]

13. I think I agree for the most part

But there are probably way more stocks than there should be with no more intrinsic value than most cryptos (regardless of what they might claim).

Many cryptos at least claim to hold intrinsic value in their utility through the ease of exchange on particular platforms. Such claims continue to face a lot of challenges, however.

[brooklynite]

11. Bearing in mind that some folks here see investing as another form of gambling...

…or a rigged pan I scheme.

The fundamental issue with blockchain currencies is that there’s no inherent value behind them, just the willingness of other purchasers to buy them.

[ColinC]

14. Well

...just the willingness of other purchasers to buy them

could be a pretty substantial inherent value, no?

A piece of art has no inherent value until it faces the willingness of other purchasers to buy them, right?


(Or an artist who has had the willingness of other purchasers to buy his art, etc)

[brooklynite]

16. Art has a long history of personal appeal for its aesthetic value...

...as well as a willingness of people (myself included) to pay for possession of it.

Bitcoin et al has only the its value as a medium of exchange outside the banking system.

[ColinC]

17. I find it unfortunate though, how like art, the value of bitcoin

Is also subject to interpretation. Some folks will find value in art based largely on arbitrary things like primarily age and demand just as cryptocurrency also has it's value dependent on arbitrary and more abstract ideas like scarcity, perceived or made up utility and the demand that comes out of such perceptions.

[KPN]

5. Yes. If you don't mind contributing to the dismantling of any form of government that

is not 100% headed up by oligarchs ultimately.

[Initech]

3. After finding out the blockchain bros voted for Fuckhead 45, they can go eat shit.

Because of course they did.

[El Supremo]

7. About as good as this:

[keithbvadu2]

10. Or this one

[ColinC]

15. Well

I would argue equating it with several goes at a slot machine, would be more accurate.

[rockfordfile]

12. China, Russia and other pos are main pushers for that crap

You have chip shortages because of the bitcoin pos. Bitcoin has affected video card prices and shortages. It's affected a number of other things because of the chip shortage.

[oasis]

18. High level pyramid scheme. 🎲🎲

[iemanja]

19. How would one go about spending it?

Is that even possible?

[The Revolution]

20. And it is a horrific waste of energy

Adding cryptocurrency mining on top of the already grim climate forecasts makes no sense.

Why don't we just ban cryptocurtency mining, buying, selling, trading, and even possession? The reason we see so many ransomeware attacks is because people keep paying the ransom. Make it illegal to even pay it and there won't be an incentive to carry out the attacks.

[Amishman]

22. Most newer crypto projects use little electricity

Bitcoin, Ethereum, Litecoin, and other older projects use Proof of Work for their consensus model, and are the power wasters you are thinking about.

Almost all projects started in the past four years are Proof of Stake, for which a validation node can run on a raspberry PI or smart phone - instead of a server room's worth of video cards or specialty hardware

Ethereum is aggressively trying to change from proof of work to proof of Stake

Most coins are hyped crap, a few have huge potential for building real world applicable technology on top of. Tezos, Ethereum, Cardano, Sol, and a select few others have great promise

as for banning it? laughably impossible.

Mining / staking could easily be encrypted or anonymized, some projects are doing this already. Crypto wallets are anonymous. Several newer projects allow for obfuscating or hiding transactions completely using zero knowledge proofs.

The only thing you could do is block mainstream adoption in the US, it will continue to thrive and grow overseas and underground.

Banning things rarely seems to be effective when people still have an interest in the contraband.

[cadoman]

21. it undermines our government and wastes electricity

and is almost exclusively used to fund illegal activity and botnets. Beyond that it's pretty cool I guess?



Oh and since the SEC doesn't regulate it worth a fuck you can easily lose all your money.

[MineralMan]

23. Well, what do you mean by "good?"

Personally, I would avoid cryptocurrency completely, due to it's extreme volatility and lack of any sort of hard backing.

I'm not putting any of my coins in a slot machine that pays out only in completely artificial currency.