[darawk]

> Citation needed. Bitfinex is one of the shadiest entities anywhere on earth. Why would you believe them?

Read the report yourself if you like:

https://www.sec.gov/comments/sr-nysearca-2019-01/srnysearca2...

For reference, when people say "95% of exchange volume is fake" this is the report they're citing. It lists 10 exchanges with volume it deems legitimate. Bitfinex is one of those 10.

> I would do that if the market wasn’t manipulated. It’s a suckers game to take any position in a manipulated market. Exchanges actively move the price up to liquidate shorts then spike it down to liquidate long. To play a rigged game at all is a suckers bet; it’s like trying to play a shell game because you’re confident you can see where they put the ball. That’s not why you’ll lose.

I'm not sure what you mean by "manipulated". The Tether/USD market on Kraken is not manipulated in any way. And it's unclear what it'd even mean if it were. How would one go about manipulating the Tether market?

> A single transaction fee for BTC is a weeks wages in Venezuela. It does not solve that problem or any other problem. Trust me if a Venezuelan were given the choice between moving a sliver of currency for a weeks wages or 600kWh of productive energy they’d very much pick the latter like any sane human.

Yes, now it's a few weeks wages. But prior to this round of hyperinflation they could have stored their wealth in bitcoin. Now it's probably too late. But i'm not referring to someone doing it now, storing your wealth somewhere will always have some cost associated with it. Wealth preservation is a step you take in anticipation of currency risk, not after its already done.

[arcticbull]

> Yes, now it's a few weeks wages. But prior to this round of hyperinflation they could have stored their wealth in bitcoin. Now it's probably too late. But i'm not referring to someone doing it now, storing your wealth somewhere will always have some cost associated with it. Wealth preservation is a step you take in anticipation of currency risk, not after its already done.

Perfect haha thus solving the problem once and for all. Except not solving any problem, and somehow even less efficiently.

Before the last few rounds of hyperinflation they could have just as well bought USD and been 70% better off. Yes if you cherry pick entry points in retrospect you can justify any position no matter how crazy. If these poor Venezuelans had only realized how valuable bitcoin was before it mattered you know? Or literally any other asset class that’s done well lately but hey don’t let me spoil the surprise.

[darawk]

> Before the last few rounds of hyperinflation they could have just as well bought USD and been 70% better off. Yes if you cherry pick entry points in retrospect you can justify any position no matter how crazy. If these poor Venezuelans had only realized how valuable bitcoin was before it mattered you know? Or literally any other asset class that’s done well lately but hey don’t let me spoil the surprise.

The only reason I cherrypicked a time period was to demonstrate that you were cherrypicking a time period. If you want to talk seriously about evaluating it as an investment, there are two ways you could go about doing that. One would be to look at it's value since inception, which makes it literally one of the best investments on the planet. The other would be to pick a hold length and evaluate the sharpe ratio for holding the asset over all periods of that length during its lifecycle (e.g. take all 1-year long daily returns streams, and compute the sharpe ratio of each, thereby obtaining a performance distribution for the asset that suggests what your expected risk-adjusted return would be, on average, for buying it at any point during its lifecycle).

I do have the data to do that analysis, but not on the computer i'm currently on. However, I think we both know how good it will look for Bitcoin. If you doubt that, i'm happy to actually run it in a day or two.

[arcticbull]

This argument has been a bit winding but to recap. I started out saying BTC was getting less efficient over time, you said it wasn't, then agreed it was. You suggested it wasn't manipulated, but we agree there's tons of data that shows its brutally manipulated. Then I argued Bitfinex/Tether is shady, you said it wasn't and that I should short USDT. I said the manipulation makes that a bad call. Next we talked about investing, and you said it was doing great, but over the last 2 years it's down 70%. Then you said it was good for Venezuela, but a single transaction costs a few weeks wages, and takes enough power to run their home for a month. Then you agreed it wasn't good for them, either. So far we agree it's performance is better than the bolivar but worse than the turkish lira. Yes, if you bought for pennies and can sell for thousands you did fine. The question isn't how much money it could have made you, the question is where's it going next. It's also probably not the single best investment in history, if you ask anyone who invested in Facebook's seed round.

It's not good for anyone, anything, or the environment. It's a crap payment system, with limited capacity, consuming an entire country's worth of energy to do what could be achieved with a single AWS instances and a DynamoDB table. And the big feature? That you can circumvent sanctions. Boy if I had a nickel for every time I wanted to pay someone in North Korea, Iran or Syria using a month's household usage of electricity, I'd, well, I'd not have any nickels.

Nobody can point to a single thing Bitcoin does better than anything else already out there except making the early adopters wealthy.

Not to mention "[a study] estimate[s] that Bitcoin generates a large welfare loss that is about 500 times as large as a monetary economy with 2% inflation." [1]

[1] https://www.bankofcanada.ca/wp-content/uploads/2019/09/swp20...

[darawk]

> This argument has been a bit winding but to recap. I started out saying BTC was getting less efficient over time, you said it wasn't, then agreed it was.

You originally said that it gets less efficient as the technology improves. That statement is false. It does however, get less efficient as the price rises. So you should only be concerned if you expect the price to continue to rise.

> You suggested it wasn't manipulated, but we agree there's tons of data that shows its brutally manipulated.

Also false. There are a bunch of exchanges that fake volume. Those exchanges do not manipulate anything, however. All they're trying to do is scam ICOs out of listing fees. They don't even have real users.

> Next we talked about investing, and you said it was doing great, but over the last 2 years it's down 70%.

I articulated the correct criteria for evaluating it as an investment. You may feel free to propose your own, of course. But I presume you haven't already done so because you do not have a better way to run the analysis.

> So far we agree it's performance is better than the bolivar but worse than the turkish lira. Yes, if you bought for pennies and can sell for thousands you did fine.

Over the time period you cherrypicked, yes. If you choose a starting point at random from its history, however, i'd bet it has performed better than any other currency on earth, on average.

> It's also probably not the single best investment in history, if you ask anyone who invested in Facebook's seed round.

Buying Bitcoin on day one was almost certainly a better investment than investing in FB at any stage. I don't know what the terms of FB's seed round was, but let's say you paid $50k for 1% (valuing it at $5mm) of FB. Today that investment is worth an astounding $5 billion, an excellent 100,000x return. However, in March 2010 you could buy Bitcoin at $0.003 each. That's a 2,666,666x return to date.

And that's March 2010, which was the earliest time I could easily find a price for in a Google search. In 2009, when it was actually started, who knows what you could have gotten it for.