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Bitcoin “crashed” to a market cap of 440 billion USD. It is valued more than the vast majority of publicly traded companies. From that measure alone, why shou

by dadoge 4y ago

Bitcoin “crashed” to a market cap of 440 billion USD. It is valued more than the vast majority of publicly traded companies. From that measure alone, why should anyone think “it’s dead”? Bitcoin ain’t tulips, ain’t the pets.com, etc, to think something that is 14 years old and valued at 440 billion is going to die anytime soon seems…so wrong Especially when in the past 2 weeks, BlackRock (biggest asset manager) is continuing to dabble more in bitcoin https://financefeeds.com/blackrock-makes-bitcoin-eligible-investment-to-15b-fund/ https://financefeeds.com/blackrock-makes-bitcoin-eligible-in...

quonn 4y ago
pets.com at least provided _some_ value.
- dadoge 4y ago
  How could something be worth 440 billion in market cap after a major correction not be valuable? This is after having a 14 year history of people learning about it, not some scam coin like LUNA that went from zero to 40 billion and to zero in less than 1 year
  - woodruffw 4y ago
    For the simple reason that market corrections are not absolutes: the only thing that a correction down to 440B tells us is that it hasn’t been corrected down to 0 yet. It may never be, but that’s just to say that “it’s still valued” is not a good argument for “it’s correctly valued.”
  - quonn 4y ago
    If I take 80 Dollars from you and promise to return you 50, is this operation also worth 50 Dollars? If so, what‘s the meaning of „worth“? If I open a bank account and someone else deposits 1 billion there and I have a contract that obliges me to return the money in a year and I am not allowed to move it or use it as a security, is my bank account or the bank creating it „worth“ 1 billion? Whether bitcoin is worth something as a tool/currency cannot be measured well by the amount of money stored in it.
- 56friends 4y ago
  I mean, not to defend Bitcoin, but if you have invested at $60 and sold at $60K - it has provided tremendous value. Most people are going to lose money on this “investment”, but just saying that it provides no value at all is a tired argument.
  - woodruffw 4y ago
    This is nihilistic value: the “value” of Bitcoin seems to be latent not in its productive capacity, but in its ability to extract value from other people. Which is to say that it has the same value that a credit card skimmer does, and that that is not a useful definition of “value.”
    - deleted 4y ago
      [deleted]
    - 56friends 4y ago
      It’s a good argument. I don’t fully agree we should limit the definition of value to only its (subjectively) productive quality. It’s like gambling - I personally don’t see value in it but, hey, many people love it so they get something from it.
  - pritambaral 4y ago
    I'm not sure if that argument is any good, since everything you say holds equally well with every pyramid scheme in history.
    - 56friends 4y ago
      Bitcoin is obviously not a pyramid scheme [0]. Criticizing things you disagree with requires a bit more skill than just using labels that don’t apply. [0] https://en.m.wikipedia.org/wiki/Pyramid_scheme https://en.m.wikipedia.org/wiki/Pyramid_scheme
      - pritambaral 4y ago
        I said nothing about Bitcoin, only about your argument. Responding to an argument requires reading it first, which is a bit more skilled than just knee-jerk reactions.
Aperocky 4y ago
Bitcoin will probably be fine, displayed bitcoins in the exchange where many regular crypto investor keep them might go poof.
- dadoge 4y ago
  Yes, the FTXs and people who use them will suffer, sadly More regulation is needed The same happened before FDIC insured banks, fake banks that would “hold your paper cash safely”
  - anonymouskimmer 4y ago
    If crypto is going to be regulated all fees need to come out of taxes from crypto earnings. Otherwise it isn't paying its way. And since it isn't creating general goods for the broader market, the taxes of the broader market shouldn't be expected to cover it.
- paulpauper 4y ago
  Bitcoin will be fine at $20k or $2. Investors, another story...
smoldesu 4y ago
> From that measure alone, why should anyone think “it’s dead”? Because everyone is waiting to exhume it when it's worth something. Bitcoin has no utility, which is not a knock against it's implementation but it is an ill-omen for it's value. The concept of 'digital gold' only works if the gold is inherently worth something. Owning a piece of a blockchain that's too expensive to transact on is a detriment, not a positive. Not to insinuate there's some 'better investment' though. Crypto is dead because the dream of democratized currency hit the mainstream and got rejected, big-time. Use it if you want, invest for however long you'd like, but you should make peace with the fact that a crypto future is nothing more than opportunistic ankle-biting.
- dadoge 4y ago
  How could ANYTHING stand the test of time and be worth 440 billion if it has no utility? Genuine question.
  - smoldesu 4y ago
    It's not Berkshire Hathaway, Bitcoin's "test of time" was 3 years of media attention that is now coming to a close. Regulation and taxation is disincentivizing people from using it. Exchanges and liquidity holders are being ousted as scammers, it's basically The Reckoning for everyone who promoted a Laissez-faire economy. I love the idea of a democratized currency, but Bitcoin's value is propped up by very little now. As I said before, you cannot run an economy on goodwill alone. Someone's getting fooled into holding the bag, and the longer you hold out for a payday, the greater the chance that fool is you.
    - mouse_ 4y ago
      14 years*
    - dadoge 4y ago
      14 years is a lot different than 3 years. That a whole decade more for people to learn about it, and especially since the main features has not changed. Yes, there are improvements to the protocol, but the main thing has changed little over the years
paulpauper 4y ago
And about $120 billon of that is stable coins It's too soon to say it won't fall further. The chart is still very weak. It won't take much for btc fall below 16k again. Another major failure like gemini or greyscale will do it. Yes, it's worth a lot still, but for most btc investors long-term returns have been bad unless you bought pre-2017. BTC is only up 15% from its 2017 highs (from 19.5k to 22.5k). This lags almost all index funds. The combined value of oil or copper is worth a lot too, but this does not make it a good investment either.
- panarky 4y ago
  Maybe all the talk about the death of crypto just reflects where we are in the cycle. The mood feels similar to late 2018 when most people weren't paying attention at all, and the few who were paying attention were just disgusted by the whole thing. When the conventional wisdom is that everything from art to sports to real estate will be imminently cryptoized, you know it's frothy, and near the top of the cycle. When the conventional wisdom is revulsion and disgust then maybe we're another six to eight months away from not thinking about it at all, which is probably the bottom of the cycle.
- RestlessMind 4y ago
  Please stop spreading FUD. > And about $120 billon of that is stable coins Check any reputable source (like [1]) and you will find that BTC market cap is 438B today without any stable coins. > unless you bought pre-2017 Get your facts straight. BTC was <4K in Q1-2019. Heck, it was <10K for the entire H1-2020. Today it is 22,762$. [1] https://coinmarketcap.com/ https://coinmarketcap.com/
pavlov 4y ago
If you have $10B worth of stock in a company with $440B market cap, you’ll have no trouble converting those shares to cash. If you have $10B worth of Bitcoin today, good luck trying to extract $10B in real dollars out of the crypto system.
- jjoe 4y ago
  Let me get ahold of the CEO of Bitcoin
- latchkey 4y ago
  If you're sitting on $10B of Bitcoin, you can certainly use it for collateral. No need to convert it to cash, unless you need to buy Twitter, or something.
  - pavlov 4y ago
    Where does one get a multi-billion-dollar line of credit with only crypto as collateral? I’m skeptical that, say, Morgan Stanley would do that. But I may be wrong.
    - latchkey 4y ago
      If you're sitting on $10B worth of anything, you know people. https://www.reddit.com/r/ifiwonthelottery/comments/9qv4e1/post_on_the_different_levels_of_wealth_that_i/ https://www.reddit.com/r/ifiwonthelottery/comments/9qv4e1/po...
      - pavlov 4y ago
        My argument is that $10B of Bitcoin isn’t worth anywhere near that. You can’t sell it without crashing the market, and you probably can’t borrow multiple billions of cash against it either because nobody in the crypto ecosystem has that kind of liquidity anymore. I’m open to be proven wrong by evidence.
        4y ago
dkersten 4y ago
It also crashed to a value that is still above the 2017 high and above what it was for 2018 through 2020.

by dadoge 4y ago

quonn 4y ago

pets.com at least provided _some_ value.

dadoge 4y ago
How could something be worth 440 billion in market cap after a major correction not be valuable? This is after having a 14 year history of people learning about it, not some scam coin like LUNA that went from zero to 40 billion and to zero in less than 1 year
- woodruffw 4y ago
  For the simple reason that market corrections are not absolutes: the only thing that a correction down to 440B tells us is that it hasn’t been corrected down to 0 yet. It may never be, but that’s just to say that “it’s still valued” is not a good argument for “it’s correctly valued.”
- quonn 4y ago
  If I take 80 Dollars from you and promise to return you 50, is this operation also worth 50 Dollars? If so, what‘s the meaning of „worth“? If I open a bank account and someone else deposits 1 billion there and I have a contract that obliges me to return the money in a year and I am not allowed to move it or use it as a security, is my bank account or the bank creating it „worth“ 1 billion? Whether bitcoin is worth something as a tool/currency cannot be measured well by the amount of money stored in it.
56friends 4y ago
I mean, not to defend Bitcoin, but if you have invested at $60 and sold at $60K - it has provided tremendous value. Most people are going to lose money on this “investment”, but just saying that it provides no value at all is a tired argument.
- woodruffw 4y ago
  This is nihilistic value: the “value” of Bitcoin seems to be latent not in its productive capacity, but in its ability to extract value from other people. Which is to say that it has the same value that a credit card skimmer does, and that that is not a useful definition of “value.”
  - deleted 4y ago
    [deleted]
  - 56friends 4y ago
    It’s a good argument. I don’t fully agree we should limit the definition of value to only its (subjectively) productive quality. It’s like gambling - I personally don’t see value in it but, hey, many people love it so they get something from it.
- pritambaral 4y ago
  I'm not sure if that argument is any good, since everything you say holds equally well with every pyramid scheme in history.
  - 56friends 4y ago
    Bitcoin is obviously not a pyramid scheme [0]. Criticizing things you disagree with requires a bit more skill than just using labels that don’t apply. [0] https://en.m.wikipedia.org/wiki/Pyramid_scheme https://en.m.wikipedia.org/wiki/Pyramid_scheme
    - pritambaral 4y ago
      I said nothing about Bitcoin, only about your argument. Responding to an argument requires reading it first, which is a bit more skilled than just knee-jerk reactions.

Aperocky 4y ago

Bitcoin will probably be fine, displayed bitcoins in the exchange where many regular crypto investor keep them might go poof.

dadoge 4y ago
Yes, the FTXs and people who use them will suffer, sadly More regulation is needed The same happened before FDIC insured banks, fake banks that would “hold your paper cash safely”
- anonymouskimmer 4y ago
  If crypto is going to be regulated all fees need to come out of taxes from crypto earnings. Otherwise it isn't paying its way. And since it isn't creating general goods for the broader market, the taxes of the broader market shouldn't be expected to cover it.
paulpauper 4y ago
Bitcoin will be fine at $20k or $2. Investors, another story...

smoldesu 4y ago

> From that measure alone, why should anyone think “it’s dead”? Because everyone is waiting to exhume it when it's worth something. Bitcoin has no utility, which is not a knock against it's implementation but it is an ill-omen for it's value. The concept of 'digital gold' only works if the gold is inherently worth something. Owning a piece of a blockchain that's too expensive to transact on is a detriment, not a positive. Not to insinuate there's some 'better investment' though. Crypto is dead because the dream of democratized currency hit the mainstream and got rejected, big-time. Use it if you want, invest for however long you'd like, but you should make peace with the fact that a crypto future is nothing more than opportunistic ankle-biting.

dadoge 4y ago
How could ANYTHING stand the test of time and be worth 440 billion if it has no utility? Genuine question.
- smoldesu 4y ago
  It's not Berkshire Hathaway, Bitcoin's "test of time" was 3 years of media attention that is now coming to a close. Regulation and taxation is disincentivizing people from using it. Exchanges and liquidity holders are being ousted as scammers, it's basically The Reckoning for everyone who promoted a Laissez-faire economy. I love the idea of a democratized currency, but Bitcoin's value is propped up by very little now. As I said before, you cannot run an economy on goodwill alone. Someone's getting fooled into holding the bag, and the longer you hold out for a payday, the greater the chance that fool is you.
  - mouse_ 4y ago
    14 years*
  - dadoge 4y ago
    14 years is a lot different than 3 years. That a whole decade more for people to learn about it, and especially since the main features has not changed. Yes, there are improvements to the protocol, but the main thing has changed little over the years

paulpauper 4y ago

And about $120 billon of that is stable coins It's too soon to say it won't fall further. The chart is still very weak. It won't take much for btc fall below 16k again. Another major failure like gemini or greyscale will do it. Yes, it's worth a lot still, but for most btc investors long-term returns have been bad unless you bought pre-2017. BTC is only up 15% from its 2017 highs (from 19.5k to 22.5k). This lags almost all index funds. The combined value of oil or copper is worth a lot too, but this does not make it a good investment either.

panarky 4y ago
Maybe all the talk about the death of crypto just reflects where we are in the cycle. The mood feels similar to late 2018 when most people weren't paying attention at all, and the few who were paying attention were just disgusted by the whole thing. When the conventional wisdom is that everything from art to sports to real estate will be imminently cryptoized, you know it's frothy, and near the top of the cycle. When the conventional wisdom is revulsion and disgust then maybe we're another six to eight months away from not thinking about it at all, which is probably the bottom of the cycle.
RestlessMind 4y ago
Please stop spreading FUD. > And about $120 billon of that is stable coins Check any reputable source (like [1]) and you will find that BTC market cap is 438B today without any stable coins. > unless you bought pre-2017 Get your facts straight. BTC was <4K in Q1-2019. Heck, it was <10K for the entire H1-2020. Today it is 22,762$. [1] https://coinmarketcap.com/ https://coinmarketcap.com/

pavlov 4y ago

If you have $10B worth of stock in a company with $440B market cap, you’ll have no trouble converting those shares to cash. If you have $10B worth of Bitcoin today, good luck trying to extract $10B in real dollars out of the crypto system.

jjoe 4y ago
Let me get ahold of the CEO of Bitcoin
latchkey 4y ago
If you're sitting on $10B of Bitcoin, you can certainly use it for collateral. No need to convert it to cash, unless you need to buy Twitter, or something.
- pavlov 4y ago
  Where does one get a multi-billion-dollar line of credit with only crypto as collateral? I’m skeptical that, say, Morgan Stanley would do that. But I may be wrong.
  - latchkey 4y ago
    If you're sitting on $10B worth of anything, you know people. https://www.reddit.com/r/ifiwonthelottery/comments/9qv4e1/post_on_the_different_levels_of_wealth_that_i/ https://www.reddit.com/r/ifiwonthelottery/comments/9qv4e1/po...
    - pavlov 4y ago
      My argument is that $10B of Bitcoin isn’t worth anywhere near that. You can’t sell it without crashing the market, and you probably can’t borrow multiple billions of cash against it either because nobody in the crypto ecosystem has that kind of liquidity anymore. I’m open to be proven wrong by evidence.
      - 4y ago

dkersten 4y ago

It also crashed to a value that is still above the 2017 high and above what it was for 2018 through 2020.