BTC in the PP

[whatchamacallit]

Could this new super computer delete a Blockchain?

https://www.newscientist.com/article/22 ... -computer/

[ppnewbie]

LTTs and Gold seem wildly speculative to some folks.

But they have track records.

I largely agree with this, ofc. But keep in mind their track records could actually prove to be very dangerous. If long bonds begin to correlate with stocks (which I believe is happening more and more), and gold stops acting as the worlds second favorite money, these track records could burn people architecting portfolios around such assumptions.

I think this horse (that happens to have all the properties of money) is worth taking a bet on. Most major governments are now forced to react to it and altcoins and DEX’s and DAPP’s. I don’t know where this is going to end up but i think the world will be a very different place twenty years from now.

One thing I am interested in is the centralization phase of a complex network. Just like everything was decentralizing on the internet and then consolidated to a few major payers.

Thanks for starting the thread!

[bitcoininthevp]

I think the US government recognizes the benefits of embracing bitcoin outweigh the risks (if any) to them.

The bitcoin network is only resistant to attacks from non-economic actors and so the only entity in the world that it isn't resistant to is the US federal reserve because they control money today.

So you either believe that the US controls money today or you don't but in either case bitcoin should succeed. I've thought about this for a long time and have come to the conclusion that bitcoin's success depends only on the acceptance of the primary non-economic actor to allow its existence.

Imagine if the second most powerful non-economic actor chooses to attack the bitcoin network at the detriment to the foremost powerful non-economic actor. This would just cause the resources of the foremost powerful to bit pitted against the second and so that attack would fail.

If instead you believe that no single entity controls money in the world, then it would require a concerted effort likely by multiple governments in order to attack the bitcoin network.

In either case it seems like the US has at least veto power over any such effort so I think that because the bitcoin network poses no threat to the US government or the US dollar, the value of bitcoin will never reflect that of a dollar replacement. This should be a good thing from the perspective of implementing BTC in the PP because it makes it clearer what BTC is going to end up as an asset class which I think most people do see as a store of value/gold alternative.

Do you not see some version of CBDCs in the US future?

[ppnewbie]

IMHO - Something is going to replace the US reserve because it seems like all reserves eventually debase. If China said (and was believable) that its Yuan was now backed by gold. I would be converting my money.

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[bitcoininthevp]

I think that is already a certainty, but I don’t see it as a response or acknowledgement of btc as a dollar threat if that’s where you were going.

Ok so if CBDCs are coming and CBDCs are for:

Monetary supply manipulation, complete surveillance, complete censorship, Government controlling your tax rate based on political ties. Your money expires. Limits to how much you can spend on meat in a month. Cant send funds to that guy that said something bad about the president. Freeze money of political opponents. They take money from white people only to pay reparations. Per hour taxing. You’re fat or didn’t get the jab?, daily fines until you comply with recommendations.

Wouldn't BTC, as an anti version of ALL of that above be a clear afront/enemy/problem/way-to-circumvent/etc to CBDCs?

[ppnewbie]

Some version of @bitcoininthevp’s post is definitely coming (IMHO). As far as the reserve currency, I view the dollar as the highest point in a sinking ship. The US reserve looks good vs other currencies but the entire ship is sinking.

[boglerdude]

> Wouldn't BTC, as an anti version of ALL of that above be a clear afront/enemy/problem/way-to-circumvent/etc to CBDCs?

Ja, which is why companies, now dependent on gov to carry them through lockdowns, won't be allowed to accept BTC.

[Don]

Bitcoin will crash and burn. It's just a matter of when. It's nothing like gold.

[bitcoininthevp]

Bitcoin will crash and burn. It's just a matter of when. It's nothing like gold.

Gold/Bitcoin have some differences and similarities:

Durability: bitcoin and gold both strong here.
Portability: bitcoin is digital thus much more portable than gold.
Divisibility: A single bitcoin can be subdivided into 100,000 sub units. Gold much hard to pay with shavings.
Uniformity/Fungibility: gold strong here (verifiability of such uniformity later). I think bitcoin is a bit weaker currently due to transactions being public. Improvements hopefully to come there.
Limited supply: bitcoin has a mathematic max of 21m coins. Gold is scarce as well but more susceptible to increases in supply with price rises (stock to flow). I think the mining asteroids argument is far off.
Acceptability: bitcoin is bad here. Gold has history and global awareness. This will be the last domino to fall on bitcoin's monetization.
Censorship Resistance: gold pretty good. Bitcoin better due to digital nature.
Security: Much easier to store bitcoin (paper, brain) than bulky gold.
Verifiability: bitcoin can be verified with free software. Gold you need contraptions for coins which are cheap. But hard for bars (see recent scandals on fake gold)
Seizure resistance: bitcoin wins as there isnt anything in the physical world that you really need to own it. Plausible deniability. Gold can be searched and found

What does crashing and burning look like for Bitcoin? Here are some actual crash and burns for Bitcoin, what do you think comes next?

$30->$1, $260->$40, $1200->$200, $19k->$3k. $65k->$28k

[bitcoininthevp]

> Wouldn't BTC, as an anti version of ALL of that above be a clear afront/enemy/problem/way-to-circumvent/etc to CBDCs?

Ja, which is why companies, now dependent on gov to carry them through lockdowns, won't be allowed to accept BTC.

Forget accepting it, US corps probably wont even be legally allowed to buy it or hold it once this battle really gets started.

Many other countries might side with Bitcoin is this battle as it is just another front to attack the US and its petrodollar hegemony.

I also wonder how many individuals, in a CBDC-being-rolled-out kind of world will watch smoke turn into fires all around them and dissidently choose for BTC's fire insurance.

[bitcoininthevp]

it could be that bitcoin and CBDCs cannot co-exist and that it is inevitable for bitcoin to cross the thresholds where it will be shut down. It would be interesting to explore what you think about this.

I think the US government can do things that slow Bitcoin adoption or affect the price. But I dont think they can shut it down.

[seajay]

it could be that bitcoin and CBDCs cannot co-exist and that it is inevitable for bitcoin to cross the thresholds where it will be shut down. It would be interesting to explore what you think about this.

I think the US government can do things that slow Bitcoin adoption or affect the price. But I dont think they can shut it down.

A official, regulated, audited state approved/sourced alternative will sooner or later be provided and regulations applied to prohibit the use of unregulated, unaudited alternatives on the basis of being used for illicit activities. Whilst Btc may not totally vanish without broader trust/acceptance it will be deeply back-watered to be of little general interest other than for those involved in illicit activities. In the meantime crack open some popcorn and watch the tulip bulb type mania/hype.

[bitcoininthevp]

A official, regulated, audited state approved/sourced alternative will sooner or later be provided and regulations applied to prohibit the use of unregulated, unaudited alternatives on the basis of being used for illicit activities. Whilst Btc may not totally vanish without broader trust/acceptance it will be deeply back-watered to be of little general interest other than for those involved in illicit activities. In the meantime crack open some popcorn and watch the tulip bulb type mania/hype.

I think some version of what you say here will happen. I am more optimistic about the number of secret dissenting individuals and smaller orgs as well as the international/geopolitical angle making the battle not as easy as you’ve outlined.

I also dont think a CBDC solves any of the problems that Bitcoin is trying to solve, per our other thread together, so an "approved alternative" like a CBDC is a bit of an oxymoron:

A good testing ground however for pre CBDC, let others take the risk of ironing out security flaws before adoption/rollout of their own version.

What do you see in common regarding the code/tech/features/incentives/game theory/goals between BTC and some USD-CBDC? AKA: what is there that could be reused from Bitcoin to CBDC?

To me it seems there is no overlap. CBDC is about centralized control by gov bureaucrats over money, including its supply, surveillance, censoring, etc. Everything about a system like that would be different from Bitcoin's finite supply, pseudonymity, censorship resistance, etc. As a result, the architecture, design, governance, everything would be completely different as a result.

Maybe Bitcoin greases the wheels a bit on the populace being more familiar with the concept of "digital assets", but that seems about it.

[bitcoininthevp]

I think it could be as easily as saying that all approved BTC transactions have to be paired with a CBDC or through a CBDC so then it effectively removes some of those features of BTC that are problematic while keeping its monetary policy.

I dont really understand what this means.

[bitcoininthevp]

I dont really understand what this means.

As in peer to peer BTC transactions could be outlawed.

All CEX pairings to be made with a CBDC, all legal DEX's will have to route their trades through a CBDC with CBDCs being the most liquid pairings for liquidity pools. All compliant wallets would route transactions via a CBDC.

CEX makes sense since they are identifiable orgs that governments can target.

A DEX, if it is really 'D'ecentralized, wouldn't be at the whim of USGs laws.

> All compliant wallets would route transactions via a CBDC.

This doesn’t make sense. I send BTC to someone, there is no need for any other currency in the transaction. Although I do agree there might be some "compliant wallet" things for BTC that have nice censorship and surveillance features. But that doesn’t require a CBDCurrency to be involved.

> peer to peer BTC transactions could be outlawed.
Certain jurisdictions can try this, but there will be dissenters that keep transacting anyways. And individuals/companies in other countries could still transact unaffected. And even countries holding BTC themselves publicly or accumulating silently are not subject to such laws.

[ppnewbie]

Bitcoin will crash and burn. It's just a matter of when. It's nothing like gold.

Gold/Bitcoin have some differences and similarities:

Durability: bitcoin and gold both strong here.
Portability: bitcoin is digital thus much more portable than gold.
Divisibility: A single bitcoin can be subdivided into 100,000 sub units. Gold much hard to pay with shavings.
Uniformity/Fungibility: gold strong here (verifiability of such uniformity later). I think bitcoin is a bit weaker currently due to transactions being public. Improvements hopefully to come there.
Limited supply: bitcoin has a mathematic max of 21m coins. Gold is scarce as well but more susceptible to increases in supply with price rises (stock to flow). I think the mining asteroids argument is far off.
Acceptability: bitcoin is bad here. Gold has history and global awareness. This will be the last domino to fall on bitcoin's monetization.
Censorship Resistance: gold pretty good. Bitcoin better due to digital nature.
Security: Much easier to store bitcoin (paper, brain) than bulky gold.
Verifiability: bitcoin can be verified with free software. Gold you need contraptions for coins which are cheap. But hard for bars (see recent scandals on fake gold)
Seizure resistance: bitcoin wins as there isnt anything in the physical world that you really need to own it. Plausible deniability. Gold can be searched and found

What does crashing and burning look like for Bitcoin? Here are some actual crash and burns for Bitcoin, what do you think comes next?

$30->$1, $260->$40, $1200->$200, $19k->$3k. $65k->$28k

Thanks for this. I'm wildly speculating its going to "crash" from $1,000,000 to $500,00 in a few short years. Which will conclusively prove that bitcoin is a fad. And CNN will sarcastically dismiss any reports of the fed board of governors are now taking the salaries in BTC!

[Hal]

FWIW - This ETF just launched in Australia

https://www.betashares.com.au/fund/cryp ... ators-etf/

[seajay]

Bitcoin will crash and burn. It's just a matter of when. It's nothing like gold.

Gold/Bitcoin have some differences and similarities:

Durability: bitcoin and gold both strong here.
Portability: bitcoin is digital thus much more portable than gold.
Divisibility: A single bitcoin can be subdivided into 100,000 sub units. Gold much hard to pay with shavings.
Uniformity/Fungibility: gold strong here (verifiability of such uniformity later). I think bitcoin is a bit weaker currently due to transactions being public. Improvements hopefully to come there.
Limited supply: bitcoin has a mathematic max of 21m coins. Gold is scarce as well but more susceptible to increases in supply with price rises (stock to flow). I think the mining asteroids argument is far off.
Acceptability: bitcoin is bad here. Gold has history and global awareness. This will be the last domino to fall on bitcoin's monetization.
Censorship Resistance: gold pretty good. Bitcoin better due to digital nature.
Security: Much easier to store bitcoin (paper, brain) than bulky gold.
Verifiability: bitcoin can be verified with free software. Gold you need contraptions for coins which are cheap. But hard for bars (see recent scandals on fake gold)
Seizure resistance: bitcoin wins as there isnt anything in the physical world that you really need to own it. Plausible deniability. Gold can be searched and found

What does crashing and burning look like for Bitcoin? Here are some actual crash and burns for Bitcoin, what do you think comes next?

$30->$1, $260->$40, $1200->$200, $19k->$3k. $65k->$28k

Thanks for this. I'm wildly speculating its going to "crash" from $1,000,000 to $500,00 in a few short years. Which will conclusively prove that bitcoin is a fad. And CNN will sarcastically dismiss any reports of the fed board of governors are now taking the salaries in BTC!

The security is concerning when China ban crypto currency transactions and also can solve (Hefei National Laboratory) the physics problem known as boson sampling in just over three minutes compared to the 2.5bn years that the worlds fastest supercomputers would otherwise take. The whole arena encompassed within private/public key based digital technology in a quantum era seems dated and in great jeopardy.

[ppnewbie]

As a slight aside. I was talking to a system admin friend of mine and he said he used to carefully have to monitor the resources used on the mainframe. Now he has to do the same thing with his cloud resources because the providers will cost kill you on every thing you do.

It would be funny if we all had to move to a paper cash / commodity economy to fight quantum computers! “The bank just lost our deposits again today - Here I’ll trade you a sack of potatoes for a book”

[seajay]

It would be funny if we all had to move to a paper cash / commodity economy to fight quantum computers! “The bank just lost our deposits again today - Here I’ll trade you a sack of potatoes for a book”

Conventional banking involves audit trail that enables illicit transfers to be detected/blocked. Unlike Btc ownership of value isn't solely based upon private key alone. If Btc is levelled to the same then it becomes just another currency but not backed by any state/government.

[yankees60]

Not sure it was posted earlier here, a work from Nassim Taleb named "Bitcoin, Currencies, and Fragility"

Even though I can't clearly understand all of his statements, its a good food for thought.

Well he's a lot smarter than I am. It's a very interesting read.

It's worthwhile to at least read the Introduction / Abstract. Thanks Vil for sharing this with us.

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[mathjak107]

Here is my opinion since while not a pp user it is a part of my gold budget that flys fighter cover for my portfolio.


The problem is we don’t know what bitcoin will respond to ….

While it is not tied to a particular country’s currency it kind of marches to its own drum ..it is not held by major central banks like gold ..

Bitcoin is a fraction of the size of the gold market so it is still in its infancy so to speak .

It is very very volatile ..last cycle it went from down 50% to a new high in 90 days .

I do own gbtc which is a bitcoin fund as part of the gold budget .and it’s kicking my ass right now .

But I kind of treat it like it’s own entity like I would a painting ……you need to just tuck it away by itself so to speak and let it sit and cycle and see where it goes …it is getting pounded now and in months can be breaking new highs , it is that crazy of an asset .

Personally I don’t rebalance it like i would a portfolio..it is way to volatile to do that .so while I consider it part of my gold budget I don’t treat it as such as far as rebalancing it goes ….it is a more a case of like a painting or stamp where it is what it is regardless of where it goes .

No way would I want to commit 25% more to it which is what I would have to if I wanted to rebalance it .

We have seen 20% drops over night and 12% gains in one session so it certainly is not like any other typical asset we would own.

But right or wrong that is how I treat it in my portfolio…..it is an unconventional asset which gets unconventional handling in my portfolio.

I guess if I was a pp user I would break bitcoin off and just call it my variable portfolio since it is money I can afford to loose and it is either going to be a swing for the fences or a bust

[bitcoininthevp]

Here is my opinion since while not a pp user it is a part of my gold budget that flys fighter cover for my portfolio.


The problem is we don’t know what bitcoin will respond to ….

While it is not tied to a particular country’s currency it kind of marches to its own drum ..it is not held by major central banks like gold ..

Bitcoin is a fraction of the size of the gold market so it is still in its infancy so to speak .

It is very very volatile ..last cycle it went from down 50% to a new high in 90 days .

I do own gbtc which is a bitcoin fund as part of the gold budget .and it’s kicking my ass right now .

But I kind of treat it like it’s own entity like I would a painting ……you need to just tuck it away by itself so to speak and let it sit and cycle and see where it goes …it is getting pounded now and in months can be breaking new highs , it is that crazy of an asset .

Personally I don’t rebalance it like i would a portfolio..it is way to volatile to do that .so while I consider it part of my gold budget I don’t treat it as such as far as rebalancing it goes ….it is a more a case of like a painting or stamp where it is what it is regardless of where it goes .

No way would I want to commit 25% more to it which is what I would have to if I wanted to rebalance it .

We have seen 20% drops over night and 12% gains in one session so it certainly is not like any other typical asset we would own.

But right or wrong that is how I treat it in my portfolio…..it is an unconventional asset which gets unconventional handling in my portfolio.

I guess if I was a pp user I would break bitcoin off and just call it my variable portfolio since it is money I can afford to loose and it is either going to be a swing for the fences or a bust

You can protect your BTC long position by, when price rallies, collaring the bitcoin by selling a call to buy a put against it for zero cost. It caps some upside and protects downside. Perhaps a good move after big rallies.

[seajay]

Netscape 4.51 (1999) browsers used 40 bit encryption, that nowadays can be cracked in seconds.

If Btc was a bank that stored its 1999 ledger/transaction entries in openly distributed encrypted form using encryption methods of the time, then the banks present day value would be zero.

Assuming Moore's law, Btc has perhaps another 10 years at most before copies of its earlier 'secure' ledger entries may be as good as being clear-text and trust/faith is totally lost.

The fundamental flaw is that of the openly shared/distributed ledger at the heart of its 'business model'.

Common advice is that more speculative investments such as stocks should have a >10 year horizon expectancy, anything shorter and you're better with safer choices such as treasury bonds. Btc is neither suited as a longer term 10+ year investment, nor is its volatility appropriate as a <10 year investment. It's a pure speculative play that could be equally played out much more quickly by visiting a Casino.

At least with money or grocery store reward credits they're backed by a physical entity. Physical gold is a tangible asset. Btc is neither.

[murphy_p_t]

Thank you Seajay... I find your Bitcoin comment to be very insightful