That's definitely not proof of real economic utility. How many bets happen in Las Vegas every day? But economically, they're negative-sum events exploiting cognitive weaknesses.
Entertainment can also have negative value. That's what the parent meant: your entertainment is provided by someone exploiting your gambling-addicted (and gambling may cause an actual addiction afaik, no less so than opioid addiction although based on different biochemistry) dopamine circuitry in order to extract actual (social) value.
They mainly provide addiction. Go to a casino sometime and look around. Do those people look like they're entertained? The slot machine zombies barely look human anymore.
You're also wrong about taxes. Consider my local taqueria. They buy raw materials and create value by making ready-to-eat food just when people are hungry. They receive cash in exchange, a portion of which they pay in taxes to fund the infrastructure their business depends upon.
That is positive sum for all participants. It has to be. If taxes tipped it into the negative sum category, they'd eventually close down.
I dont think you've followed through on that model of yours.
If you buy 50 dollars of taco materials, then taco materials seller makes likes than 50 dollars ,because the state will charge a tax on him. If he didnt sell 50 dollars worth of raw materials, he would have 50 dollars of raw materials to consume, instead of less than 50 dollars.
On the other side, making the taco, you have the same issue: if you sell 100 dollars of tacos, and someone pays you 100 dollars for them, you then pay taxes.
You earn less than 100 dollars, and someone else lost 100 dollars. Repeat the proces ad-infinitum and your holdings go to 0. (assuming for simplification, any rate of positive taxation on income).
This makes no sense at all, and is not how business works.
Most economic activity is positive sum. When I'm hungry and on the go, a taco is more valuable to me than raw taco materials, so I pay more for it. Value has been created. The taqueria owner takes money in, pays their expenses, and is left with a profit. Taxes are paid out of that profit, and you could just as well model it as another kind of expense, a societal infrastructure fee.
I dont think you've followed through on that model of yours.
If you buy 50 dollars of taco materials, then taco materials seller makes likes than 50 dollars ,because the state will charge a tax on him. If he didnt sell 50 dollars worth of raw materials, he would have 50 dollars of raw materials to consume, instead of less than 50 dollars.
On the other side, making the taco, you have the same issue: if you sell 100 dollars of tacos, and someone pays you 100 dollars for them, you then pay taxes.
You earn less than 100 dollars, and someone else lost 100 dollars. Repeat the proces ad-infinitum and your holdings go to 0.
An awful lot of casino gambling involves series of small stakes bets on low payout options which don't even meaningfully increase upside portfolio variance over time after the house edge has been taken out. Might still be rational from a utilitarian perspective if one really, really enjoys card games of course, but not from a portfolio allocation perspective.
Apart from weird edge cases where an actor needs to double their money overnight to return to solvency in order to have a chance of benefiting from an income stream in future, there aren't many cases where it makes sense from a portfolio allocation basis given the existence of non-negative expectation bets in other markets with a wide range of possible variances. The insurance and investment management industries are built on the principle that economic rationality works in exactly the opposite way to gambling: that inherent value exists in reducing risk.
300 million transactions in 9 years is ridiculously low compared to any "fiat" currency. Googling around I find a post that gives a lower bound for number of debit card transactions in the USA alone as 47 billions for 2012 alone[1]. That's not counting the rest of the world and the other exchange media like cash or bank transfers. 300 million transactions is nothing. I mean thing about it, it's one single transaction for every person in the USA over the course of 9 years. Alternatively it's less one transaction per year for the entire population of Canada.
Amazon alone probably handles more transactions over the course of a couple of weeks.
Gambling has way more transactions. LIBOR options have more transactions. Any actively traded stock has more transactions. None of those things are currency.
That's not buying anything with Bitcoin. You are converting your Bitcoin to USD and then purchasing using the traditional, centrally controlled financial system.
And that's not even considering the transactions fees it costs to get the Bitcoin to your account.
Then there are the transaction fees for using the card, which coinbase says is free "for now".
No. Someone is traveling to Europe, going to a restaurant and paying for the Euro nominated beer with his US based VISA and starting to claim that hey, cool, I paid for the beer with USD. You see, I lost a portion of my USD balance and gained a beer.
If you insist that the guy paid his beer with USD, it is going to be very difficult to discuss about anything as the meanings of the concepts are so twisted.
It is quite obvious that using a credit card that then accepts BTCfrom you does not mean that you use BTC to pay for anything but your credit card bill.
It's more like saying you can't buy anything with gold.
Credit and debit cards are just a way of shifting dollars around. Bitcoin is more a commodity than a currency. Yes, you can convert gold or oil to dollars and buy things, but you can't walk into a store and give them some gold flake or a quart of Texas crude in exchange for a candy bar.
> Credit and debit cards are just a way of shifting dollars around
A credit card is shifting a line of credit, an intangible promise to pay, a form of trust, that happens to be denominated in dollars.
We can pretend it's just a balance of dollars, even though it technically isn't, because it makes conversations easier, and in practical fact that's how it appears to work. But that's just a shorthand.
We can use the same shorthand to say someone bought something with bitcoin.
There's no reason to demand perfect technical precision with bitcoin and no similar pedantic precision with lines of credit.
> you can't walk into a store and give them some gold flake or a quart of Texas crude in exchange for a candy bar
I think this is the best test. Here the guy has done that. He walked in with bitcoin and walked out with tacos. When you say that's not really what happened, it feels like a no true scotsman response.
It did not. He gave them dollars, not a quart of crude. That he might have a side deal with somebody else to trade beanie babies for dollars does not make beanie babies a currency.
Bitcoin is not a currency. Plenty of other things are true currencies, so there's no fallacy here.
Sure you could also pay your groceries with lead dispensed from a gun. But that's currently nowhere near broad addoption. It just doesn't meet the definition of "currency", though it will virtually always be current.
Shift isn't sustainable in it's current form. They are temporarily not charging for domestic transactions. Since there is a cost for those transactions, there will eventually be a fee per transaction.