@JustAnotherTimeline, would you be able to explain a little these cycles you've mentioned previously?
Cryptocurrency
- Thread starter Playboi Carti
- Start date
I think around 120 years from now that last Bitcoin will be mined. Until that time the amount mined will be halved every 4 years. Inflation right now is around 1.8%.and will drop every 4 years.
Once the last Bitcoin is mined the theory is that adoption will be sufficient for transaction fees to compensate the decentralized worldwide nodal network. Basically, you and I or anyone else can run a node (which you can now but it's not a money making endeavor) in the future and the fees you receive will be sufficient as to encourage participation.
Sure, basically the 4 year cycle is propelled by the halving of mining rewards every 4 years. It takes place in the middle of the cycle. The last halving event was 2020 and will occur again in 2024. There are only a few data points but so far the halving has created supply shock that eventually propels a massive bull run. Then, it is followed by equally massive bear market.
If you look up a market cycle image on Google Bitcoin cycles fit that model pretty well thus far. Difference is Bitcoin cycles are more violent and shorter then other asset classes.
So right now most people think we are still in a bull run. The question of when or if the bear comes again is anyone's guess.
Lastly, some btc experts think this is the last violent cycle. And that adoption is accelerating fast enough with cities, countries, and institutions for Bitcoin to being a more mature and less violent bull/bear flow. That is a called supercycle theory
Ok so I was given a prepaid visa gift card. Any ideas on how to convert to crypto? Neither Coinbase nor PayPal allowed me to do it
This is why you should be bullish on crypto. This kind of infrastructure is completely unnecessary. Keep in the mind all banks do is take your deposits and lend them out. There is money in the system, but you don't get it. The banking class builds lakes instead.
Decentralized accounting ledger and smart contracts solves this with no middle man.
www.kcci.com
Decentralized accounting ledger and smart contracts solves this with no middle man.
West Bank announces new headquarters building project
The suburb's oldest business will move south of Valley West Mall.
www.kcci.com
What do you think about Crypto.com spending $700 million for naming rights for Staples Center.
Seems like solid marketing. Are you equating those marketing dollars to the west bank building?
This is why you should be bullish on crypto. This kind of infrastructure is completely unnecessary. Keep in the mind all banks do is take your deposits and lend them out. There is money in the system, but you don't get it. The banking class builds lakes instead.
Decentralized accounting ledger and smart contracts solves this with no middle man.
West Bank announces new headquarters building project
The suburb's oldest business will move south of Valley West Mall.
I think you're massively overestimating the effect this has on rates.
I bank with a credit union, one that has no locations. The rates are scarcely better than Wells Fargo, for example.
That is the thing I don't get with these defi crypto rates, they don't make any sense, they are basically usury rates.
Maybe. But it was just an example. I maintain that the banking infrastructure is costly and archaic and robs depositors of rightful yield.
There are all sorts of crazy returns out there in defi. Many of those are ponzi yield farms of which I would never endorse.
But respectfully, I believe you wildly underestimate the returns that naturally occur as part of crypto based peer to peer depositing/lending protocols. The middle man banker just bloats the system and adds minimal or zero value imo. Heck even Coinbase was going to offer 4% returns on USDC stablecoins. As a company they were going to guarantee the funds. Then the ruling class had a conniption and crushed the innovation.
It is a ridiculous that people cannot use a traditional savings account to AT LEAST keep up with inflation.
Update as of 5pm ET, Friday, September 17th: we are not launching the USDC APY program announced…
Our goal is to create great products for our customers and to advance our mission to increase economic freedom in the world. As we continue…
blog.coinbase.com
I'm super, super sick so I can't but I was going to go to a meeting today with two friends of mine who are DEEP into crypto. I didn't realize how deep until I went to his house on Friday but one of them was talking about quitting his traditional job, and the other was talking about slowing down his workload. I'd never share anything they told me but man it's pretty crazy to find out some of the returns they are getting through farming and reinvesting it. Admittedly I don't get the rates. but I'll be getting into it a little more.
Maybe. But it was just an example. I maintain that the banking infrastructure is costly and archaic and robs depositors of rightful yield.
There are all sorts of crazy returns out there in defi. Many of those are ponzi yield farms of which I would never endorse.
But respectfully, I believe you wildly underestimate the returns that naturally occur as part of crypto based peer to peer depositing/lending protocols. The middle man banker just bloats the system and adds minimal or zero value imo. Heck even Coinbase was going to offer 4% returns on USDC stablecoins. As a company they were going to guarantee the funds. Then the ruling class had a conniption and crushed the innovation.
It is a ridiculous that people cannot use a traditional savings account to AT LEAST keep up with inflation.
Update as of 5pm ET, Friday, September 17th: we are not launching the USDC APY program announced…
Our goal is to create great products for our customers and to advance our mission to increase economic freedom in the world. As we continue…
I'm not going to say that there are no costs that could be saved within the banking industry through things like eliminating or reducing physical locations, but those costs are tiny relative to the overall business. A nice new bank facility might cost $50-100M and would be paid for on a 20-30 year loan. Compare that to the amount of money they have running through their banking business and it's going to look very small.
The bottom line is that the with Fed's interest rate set at effectively zero, it makes no logical sense that savings accounts could provide a significantly higher return. Why would the bank pay you 4% on your money, when they could borrow from the Fed at 0%? The answer is simple - they won't.
The reason that Coinbase has to offer 4% on their account is because they are essentially facilitating peer to peer microloans. You're taking on the risk of loaning your crypto to another individual or business. Basically, they are looking at setting up an unregulated shadow banking system subject to the same issues that caused bank runs during the depression. Certainly not the place I'd put my emergency fund or savings I'll need to access in the next few years.
Great post! Thanks for the response.
Yes, I understand the fundamentals. You and I simply sit on opposite sides of the risk/reward spectrum in this regard.
Bottom line for me is that I trust bitcoin more then I do the banking sector and government bureaucrats.
With bitcoin, I can deposit, borrow against myself if I need funds, etc.
It is my opinion that the suits have been stealing from the people for years by debasing our currency. What makes you trust it?
I trust the banking and "mainstream" financial system over bitcoin, crypto, and smart contracts for a few reasons:
1) The system has decades of past experience to build in safeguards against fraud, negligence and other issues that can cause me to lose money. If someone steals my credit or debit card and makes fraudulent purchases, I can contact my bank and they will refund the money to me within a few days. If someone steals my bitcoin (or my cash, physical gold, etc) the best I can do is file a police report and hope for a miracle.
2) If I'm looking for higher risk, greater reward than a savings account, CDs, etc, there are plenty of ways to do that through the existing financial system. Stocks, bonds, real estate, commodities, etc are all ways that I can invest my money through established systems that have all kinds of things like fraud protection built in.
3) While Bitcoin does seem pretty unlikely to go to zero, it's still a very highly volatile asset. I'm not personally comfortable with owning an asset that volatile for anything other than a bit of fun. Other crypto beyond BTC and ETH are pretty much just memes and fads that are very likely to vanish or lose 90% of their value over night.
4) I don't agree with the premise that the Fed or the government are stealing money from us or debasing our currency. They are dealing with the problem of an expanding economy. If there is a bigger economy and more business going on, more people living in the country, there is a need for more money or we will have problems. I fundamentally disagree with the concept that there must be a hard money system for money to have value. I also believe that there is no such thing as a true "hard money." Even gold is only worth what you say it's worth. Its intrinsic value is its value in electronics and jewelry, which is much less than the value it trades for. At the end of the day, all money is Fiat, including Bitcoin. I don't think the Fed or the Government have handled things perfectly. Far from it. But, they're not stealing from us.
5) You can also deposit USD and borrow against yourself. For example, a home equity loan denominated in USD. Yes, there are other people and organizations involved in helping you do that, but then, if you use Coinbase or another similar site to do your Bitcoin self borrowing, it's the same thing. A bit less red tape, for sure. But again, that red tape is there for good reason 95% of the time - to protect you from fraud, predatory business practices, lower the overall risk of the financial system to help prevent a 2008 crash, etc.
Thank you for taking the time to make such a robust response!
1. Agree
2. True
3. A bit cynical, but fair enough. More time and greater adoption will cement others imo.
4. I don't understand why more money is needed? What's wrong with better buying power for existing currency? Also, I disagree with your definitions. Bitcoin's value is driven by the community, outside-in. Fiat value is driven by the governments decree, inside-out. They are opposites.
Money simply represents value added to the system at a given time. If wages are earned now, why should we not expect they will have similar similar buying power in the future? The system is rigged. To me that is stealing. Do you ever wonder how humans continue to innovate and improve manufacturing and yet goods are not cheaper? Economically, that is what should happen. But it doesn't.
5. Home equity is a great example. The problem is many people cant afford appreciating assets to borrow against. They can afford bitcoin. But I do see your point. Lastly, if you read the bitcoin whitepaper is was created BECAUSE of the 2008 crash and subsequent bailout. 2008 is the reason it is needed, not protect us from it.
This is why you should be bullish on crypto. This kind of infrastructure is completely unnecessary. Keep in the mind all banks do is take your deposits and lend them out. There is money in the system, but you don't get it. The banking class builds lakes instead.
Decentralized accounting ledger and smart contracts solves this with no middle man.
West Bank announces new headquarters building project
The suburb's oldest business will move south of Valley West Mall.
An encrypted link list that does nothing but waste resources is not banking.
There are a lot of reasons that it makes sense to generate more money as the economy expands and more people participate. If you choose not to expand the money supply, you've created deflation. Yes, it does increase your buying power. However, it also slows down the economy as people tend to save their money thinking they will get a better deal if they just wait until their buying power increases further. This is why the Fed and monetary policymakers around the world target small inflation rates - to give people incentives to stay active in the economy.
At a certain point, you also reach practical limits of the money supply. If I want to build a house and I need to borrow money, if there is a hard money system if you keep a hard money system and never expand the supply there is a real chance that there literally may not be money available for me to borrow. This type of situation happens in the real world today at the level of international trade - it's called a dollar shortage. In a way, most countries of the world back their currency with USD as a sort of hard currency. At least, a currency they don't have control over. It's a fairly abstract topic, but I think this article explains it reasonably well: https://mises.org/wire/why-world-has-dollar-shortage-despite-massive-fed-action.
When you say that the system is rigged, I'm not sure who you think is rigging it or for what purpose. Goods have gotten cheaper. If you look at a price chart of typical consumer goods, you'd see that many of them have gone down over time when you look at it in terms of decades and centuries. If you're looking at the past year, sure things have gone up. But if you looked at say 2014-2019 you'd see many prices decreasing over that time.
Fiat currency's value is not determined by government's decree - it's determined by the people who use it. Look at Zimbabwe, Weimar Germany, or dozens of other examples - the government didn't say "Our currency's value should decrease to the point that it is worthless." The people said that - they didn't accept that the value of their money remained the same after all the printing. They could have. The value of the US Dollar and the Euro sometimes go up on their own too - governments would prefer they didn't get too strong to help international trade, but they don't get the choice. If the people said they don't think there is any value in the US Dollar, government decree would not make it valuable. Currency of any kind is only valuable because people think it's valuable. The only power the government has is to redirect its people to say "this not that" and that only works if the people go along with it. Just like Bitcoin. It only has value because people think it has value. And the minute people stop thinking it has value, it's just a fancy computer program.