The article misses the point. Bitcoin mining in China was a legal way to get money out of the country. Buy a share in a mining pool in yuan, get Bitcoin delivered, sell it in Hong Kong or elsewhere, get dollars or yuan. That was viewed as "manufacturing and exporting", which is legal, encouraged, and sometimes subsidized. That's what powered Bitcoin mining in China.
China has exchange controls. You can't just exchange yuan for dollars or euros. there's a limit of about US$50,000 per year per person, and even that is sometimes restricted. No other major country has exchange controls like that.
I am listening to "The Bitcoin standard" right now and just came by the part where the author explains why he thinks bitcoin is a case of "any publicity is good publicity". And it does not seem very far fetched to me
I have a long standing issue with crypto that's starting to bug me...
When i buy stock i'm hoping for two things. first that it increases in value but also that i get to collect some dividends because i own a tangible piece of a company.
When i buy ETH or XLM my only goal is to sell it on to someone else for more, i get nothing while i hold it and can't actually use it for anything. All i'm doing is searching for a bigger idiot to buy it off me.
What am i missing?
Edit: I get crypto is emotive and a lot of you guys are balls deep in the cult but it'd be nice to get some answers rather then my post just getting hidden.
Warren Buffet said the same thing, you are not missing anything:
"Cryptocurrencies basically have no value and they don't produce anything. They don't reproduce, they can't mail you a check, they can't do anything, and what you hope is that somebody else comes along and pays you more money for them later on, but then that person's got the problem. In terms of value: zero.""
One obvious thing that nobody seems to mention is a store of value that the government can't devalue (that requires a more stable crypto system, I will grant you that), can't tax[0] and can't control. You may have all sorts of objects to that, they point is that there are good solid people out there, with long memories, deep understanding of the financial system and no trust in the governments ability to handle it.
As for stocks, I buy and hold them, but yes I am explicitly looking for a the next sucker who is willing to pay more when I need to liquidate them.
[0]: they will have to tax something else, like a sales tax. I am fine with that, I just don't want them to be able to take what I own.
I concluded a while ago that there's an uncrossable chasm between the people who understand/agree with your first paragraph and those who don't. Any argument beyond that is just people talking past each other.
I am curious, why did you believe that posting this comment to HN would benefit the community? It has no new information and, to somebody like me with a more nuanced view of crypto, just appear stupid and arrogant.
Compare Bitcoin's energy consumption to a country like China. It's not so devastating to the planet. Bitcoin currently consumes around 110 TWh per year — 0.55% of global electricity production, or roughly equivalent to the annual energy draw of small countries like Malaysia or Sweden. China as of 2019 was ~39,000 TWh, with the China ban the energy consumption can only improve. As miners move away from coal and on to more renewable sources and countries.
That's more than the whole world (per your own numbers, 110 / 0.0055 = 20,000). I am seeing more like 7,500 TWh for 2019.[0]
Also, 1.4 billion people live in China and they make a huge amount of the world's durable goods, so it makes sense that they will consume some power. Bitcoin does jack shit.
If China uses 3900TWh a year, that would be twice the global consumption by your claim that 110TWh = 0.55% global. Of course that number is about an order of magnitude off.
If Bitcoin being as useless as it is consumes 0.55% of global electricity isn’t alarming I don’t know what is.
Why would anyone compare electric consumption of a country with digital currency? That is the most ridiculous comparison I've ever seen. In terms of reaching, this reaching to mars and possibly beyond. Lets compare energy consumption of bitcoin with online banking. That's at least in the same neighborhood. A country contributions to mankind include infrastructure, manufacturing, mining, powering hospitals, airports, schools, sewage system, trains, telecommunication, research labs, libraries, warehouses, ..... list goes on. What does bitcoin does? nothing. There is no comparison.
This will only affect the flow of new, mined bitcoins which are a small percentage of the total supply. Bitcoin's protocol also has a difficulty adjustment built into it, so when hashrate goes down mining difficulty goes down to compensate so the rate of new bitcoins being mined stays pretty even over time.
Maybe. That also depends on if demand is there to increase the price also. I can have a one of a kind piece of art work. Yet because it looks like something I scratched out on a napkin a few mins ago (I did) it is still not worth much. As there is low demand.
Assets like this can do that. Where the demand is there just because everyone else is demanding it (oil had this a few years ago). But if that demand collapses so will the price.
I think the alg has a built in rate limiter too to pick up the slack. That limiter can go up or down too. Keeping new supply coming in at a particular rate.
Overall though bitcoin looks like a deflationary style monetary system. So speculation will be more common too.
Readit News
China has exchange controls. You can't just exchange yuan for dollars or euros. there's a limit of about US$50,000 per year per person, and even that is sometimes restricted. No other major country has exchange controls like that.
A big use case for Bitcoin just went away.
Getting money out of China is 1) hard, and 2) often illegal.[1]
[1] https://www.bloomberg.com/news/articles/2021-03-11/from-cryp...
When i buy stock i'm hoping for two things. first that it increases in value but also that i get to collect some dividends because i own a tangible piece of a company.
When i buy ETH or XLM my only goal is to sell it on to someone else for more, i get nothing while i hold it and can't actually use it for anything. All i'm doing is searching for a bigger idiot to buy it off me.
What am i missing?
Edit: I get crypto is emotive and a lot of you guys are balls deep in the cult but it'd be nice to get some answers rather then my post just getting hidden.
"Cryptocurrencies basically have no value and they don't produce anything. They don't reproduce, they can't mail you a check, they can't do anything, and what you hope is that somebody else comes along and pays you more money for them later on, but then that person's got the problem. In terms of value: zero.""
As for stocks, I buy and hold them, but yes I am explicitly looking for a the next sucker who is willing to pay more when I need to liquidate them.
[0]: they will have to tax something else, like a sales tax. I am fine with that, I just don't want them to be able to take what I own.
ETH should be possible to stake soon-ish, other examples are ADA, ALGO and many more..
To most people, Bitcoin is synonymous with crime - ransomware, scams, drugs.
Deleted Comment
That's more than the whole world (per your own numbers, 110 / 0.0055 = 20,000). I am seeing more like 7,500 TWh for 2019.[0]
Also, 1.4 billion people live in China and they make a huge amount of the world's durable goods, so it makes sense that they will consume some power. Bitcoin does jack shit.
[0]https://www.climatescorecard.org/2021/01/electricity-consump...
If Bitcoin being as useless as it is consumes 0.55% of global electricity isn’t alarming I don’t know what is.
Dead Comment
Assets like this can do that. Where the demand is there just because everyone else is demanding it (oil had this a few years ago). But if that demand collapses so will the price.
I think the alg has a built in rate limiter too to pick up the slack. That limiter can go up or down too. Keeping new supply coming in at a particular rate.
Overall though bitcoin looks like a deflationary style monetary system. So speculation will be more common too.
Deleted Comment