Blockchain Revolution: from the internet of information to the internet of value

[Shyheels]

I am glad you got something of substance - shoes - for your crypto. Boots would have been better. 

[kneehighs]

1 hour ago, Shyheels said:

I am glad you got something of substance - shoes - for your crypto. Boots would have been better. 

Thanks!  I keep my Michael Kors Hamilton riding boots in excellent shape so no need for new boots yet.

Here's a good article on the crypto bubble.  https://www.inc.com/bill-carmody/understanding-blockchain-bubble.html  It's a short read that talks about telegraph, railroad, dotcom, and now blockchain bubbles.   Great stuff. 

[Shyheels]

Bitcoin doesn't sound like all that much fun or so very easy to use and trade according to this:

http://money.cnn.com/2017/12/12/technology/how-to-sell-bitcoin/index.html

[kneehighs]

8 hours ago, Shyheels said:

Bitcoin doesn't sound like all that much fun or so very easy to use and trade according to this:

http://money.cnn.com/2017/12/12/technology/how-to-sell-bitcoin/index.html

It's because he used Coinbase, which has notoriously slow fiat to btc conversion times.  Trading btc to another crypto on exchanges like Binance or Bittrex averages about 10 minutes.  Exchanging btc to fiat is even easy on Coinbase.  Just sell and Coinbase will lock in the exchange rate at time you ordered the transaction.  Then wait 7-10 days.

Sometimes using a debit card to turn fiat into btc is fastest.  I experimented with bitcoin.com's debit card purchase platform.  Had my btc trading within 1-2 hours.  

[Shyheels]

Even so, that doesn’t exactly make it useful as a medium of exchange. Somebody needs to decide what’s it meant to be - a useable medium of exchange or a speculative investment. Fiat currencies are both - much handier, me thinks.

[kneehighs]

2 hours ago, Shyheels said:

Even so, that doesn’t exactly make it useful as a medium of exchange. Somebody needs to decide what’s it meant to be - a useable medium of exchange or a speculative investment. Fiat currencies are both - much handier, me thinks.

I interpreted trading to mean across exchanges, not a medium of exchange. 

Regarding ease of use, that "decision" will be a process, not an overnight effect.  

From the publicly traded exchanges: Metropolitan Bank, which is up 40% from it's Nasdaq IPO last month, has a debit card "shift" that enables consumers to spend their btc.  

From the prepaid debit card industry: BitPay is prepaid debit card that enables spending btc.

From the crypto industry: TenX, Monaco, Wirex, and Bitcoin Cash all have debit card systems worked out for release too.   

Edited December 13, 2017 by kneehighs

[kneehighs]

WARNING: LONG POST, but entertaining to read.  This is meant for entertainment reasons only.  Do what you want with the information. 

Some really prescient quotes from the January 9, 1988 article in The Economist "Get ready for a world currency"  

"THIRTY years from now, Americans, Japanese, Europeans, and people in many other rich countries, and some relatively poor ones will probably be paying for their shopping with the same currency. Prices will be quoted not in dollars, yen or D-marks but in, let's say, the phoenix"

"As telecommunications technology continues to advance, these transactions will be cheaper and faster still.  With uncoordinated policies, currencies can get only more volatile.  Alongside that trend is another of ever expanding opportunities for international trade.  This too is the gift of advancing technology."

"As the next century approaches, the natural forces that are pushing the world towards economic integration will offer governments a broad choice.  They can go with the flow, or they can build barricades.  Preparing for the phoenix will mean fewer pretended agreements on policy and more real ones.  It will mean allowing and then actively promoting the private sector use of an international money alongside existing national monies.  That would let people vote with their wallets for the eventual move to full currency union."

"The world phoenix supply would be fixed by a new central bank, descended perhaps from the IMF..." 

The truth is in 1996, the National Security Agency (NSA) founded in 1952, wrote a White Paper titled "HOW TO MAKE A MINT: THE CRYPTOGRAPHY OF ANONYMOUS ELECTRONIC CASH" It was first sent to an MIT mailing list.  Later, it was published in the American University Law Review here.  SHA 256, the secure hash algorithm used by bitcoin, was also created by the NSA: https://en.wikipedia.org/wiki/SHA-2

 

 

[Shyheels]

Interesting!

 

[at9]

The January 2018 issue of Scientific American has a set of articles about blockchain, cryptocurrencies etc. Well worth reading for anyone with an interest in the subject.

The single most important thing I've got from those articles is that these technologies are in their infancy, there's a lot of people with a stake in some part of the process (not just bitcoin) and they won't go away in a hurry. Exactly how they will affect our futures is of course unknown and unknowable. I expect a bumpy ride, with many failures and possibly some great successes. Rather like the dotcom boom almost 20 years ago.

[Shyheels]

I think it will be very similar to the dot com boom of 20 years ago. Some people will make an absolute killing, others will lose their shirts, the world will move on, older and little wiser. And like the dotcom boom it will alter the landscape in some way that we cannot yet see or predict but which will, twenty years from now, seem obvious in hindsight.  

[kneehighs]

Where else can you 10x your money in one week?   (not an exaggeration)

So far, my favorite pick for the "next bitcoin" is Ripple.  It's like bitcoin for banks.  Enables real time cross border transactions for banks with low fees 24/7.

Currently consolidating around 75 cents/share.  It'll take some patience, but it's a solid organization.

https://www.reddit.com/r/Ripple/

https://coinmarketcap.com/currencies/ripple/

 

 

[Shyheels]

That's true - there aren't many speculative investments, outside of those made at racetracks or on roulette wheels, where one could get a1000% return in a week.   

But I am no more tempted by cryptocurrencies than I am by betting on the ponies or systems at roulette....

Edited December 21, 2017 by Shyheels

[kneehighs]

18 hours ago, Shyheels said:

That's true - there aren't many speculative investments, outside of those made at racetracks or on roulette wheels, where one could get a1000% return in a week.   

But I am no more tempted by cryptocurrencies than I am by betting on the ponies or systems at roulette....

I'm sorry to hear that.  It will be your lost opportunity.

You see, Wall Street hasn't even developed a narrative around the crypto economy yet.  They did around Junk Bonds, the dot com boom, and the housing boom though.  And many who played those markets shrewdly, made absolute fortunes.

And what will Wall Street's narrative be for crypto?  How will Wall Street pitch crypto?  Crypto is an uncorrelated asset (not affected by S&P, Consumer Price Index, or Gold prices).  So by adding crypto to your portfolio, you will smooth volatility and hedge risk (World Academy of Science and Engineering Study conclusion).  Once this "hedge of risk" narrative takes hold, what is now just a .6 trillion economy (crypto) will merge into 5-10% of the global stock market wealth (100 trillion).  So we can expect about another 4.5-9.5 trillion dollars to go into the crypto economy beginning in 2018.

Buckle up, b/c the ride is just starting.  

Edited December 22, 2017 by kneehighs

[Shyheels]

They said the about the space shuttle Columbia as it shot into the skies, on its way to Heaven.

No doubt I miss opportunities every time I walk past a race track or a casino and keep walking. Junk Bonds, the dot com boom and the housing boom all made people's fortunes - some people - others lost everything and/to well to jail. And now they are all just historic blips. Crypto may leave a more lasting legacy but I have a feeling it will be very different that anybody is predicting.  Better, worse, who knows but I don't think that the vision now is how it is going to play out in the long term.

 

[kneehighs]

Sincere question. How do you think the vision now will play out in the long term?

[Shyheels]

I think crypto will be looked back upon as something very dated and of its time, but also as something from which other, more useful things, sprang. What those other things or developments might be, I have no idea.

[kneehighs]

Definitely agree that other useful things will spring from crypto. And that it's tough to specify what those things will be.

The part about crypto being "dated" has me baffled though. Maybe by the time we colonize Ross 128 b? It's going to be many decades if not centuries before crypto becomes a dusty antique.

[Shyheels]

It will be seen as something that sprang of its time - the Dotcom bubble, for example, was so 1990s. Junk bonds were so 1980s...

On a more current note, Bitcoin and crypto certainly isn't having such a great week at the moment, is it/are they? 

[at9]

Like so many booms, the few who are lucky and/or fleet of foot (even if wearing heels) will make fortunes. The majority of punters will lose. The even greater majority of those who stood on the sidelines will neither win nor lose, though they might be caught in the fallout. Yes, there's the opportunity cost of NOT doing something. If I'd put £1000 into Bitcoin a few years ago and cashed out recently I'd have done very nicely thankyou. £1000 is a sum I can afford to lose though I'd rather not. As it is, I've made more modest returns on that £1000 in stockmarket based investments.

If you've got a decent sized investment portfolio you can afford some gambling money, the amount depending on your temperament. I'm not a very "hands on" investor. I'm not in the business of tracking the markets day by day, let alone hour by hour. It might make me a lot of money but I'd find it an excrutiatingly dull and unproductive thing to do. So I'm not investing in crypto currencies.

The people I worry about are those with limited resources who put a large fraction of their very limited savings into a high risk financial product. Especially those people who have little understanding of risk. Of course somebody in desperate circumstances might consider betting their last $$ on Bitcoin, roulette or the horses but that's real last ditch tactics.

[Shyheels]

It's not looking like such a red-hot investment now:

http://money.cnn.com/2017/12/22/investing/bitcoin-plunges-below-14k/index.html

[kneehighs]

It's a correction. Corrections are healthy. Could be: Liquidation for holidays, tax strategy liquidation with regards to "like kind" trades, Youbit thieves liquidating (they stole 17% of Youbit's assets), expanded flat fractal correction (tech analysis). https://steemit-production-imageproxy-upload.s3.amazonaws.com/DQmaP4MVkWMvfWKBTUhjAPKU3ACz2K7qp2NAeYFroN3p7ts

Whatever. Volatility is expected. My portfolio is green.

And like I said before, Wall Street still hasn't developed a narrative around crypto. Believe me, Wall Street makes money by holding people's money. They will find an angle to get people's money with crypto. And since crypto is an Uncorrelated Asset (unlike the correlation between Stocks and Bonds), my best guess is the best is yet to come.

[alphax]

Under or around $13K now.  Briefly under $12K today.

https://www.worldcoinindex.com/coin/bitcoin

So at what point would you be worried? 

I mean an investment implies that at some point, you will cash out, hopefully for a profit.

If you play futures, then if it's on a downwards slide, you should sell short to make money.

It's not just BTC, all CCs had large drops/selloffs

https://arstechnica.com/tech-policy/2017/12/bitcoins-price-is-down-33-percent-from-highs-earlier-this-week/

Edited December 22, 2017 by alphax

[Cali]

"Trading Places"...great holiday film. Orange Juice futures.

[kneehighs]

Like I say, the best is yet to come. Wall Street makes money by keeping people's money. The pitch to get a % of the 100 Trillion in Stock Market wealth into crypto hasn't even begun yet. But when that narrative takes hold, crypto will REALLY soar. Goldman Sachs is leading the way this June

https://www.bloomberg.com/news/articles/2017-12-21/goldman-is-said-to-be-building-a-cryptocurrency-trading-desk

"crypto is a non-correlated asset!! It will smooth overall portfolio volatility and hedge risk, just like this study proves!!"....

http://waset.org/publications/10006245/analyzing-the-effects-of-adding-bitcoin-to-portfolio-

Also, price the All Time High's of btc over the last year:

December 22: 17,185. ATH: 19,974
November 20: 7,972. ATH: 8033
October 20: 5,660 ATH: 5873
September 20: 3,993 ATH: 4942 (went as low as 2946)
August 20: 4,106 ATH: 4466
July 20: 2,540 ATH: 2998
June 20: 2,622 ATH: 2998
May 20: 2,007 ATH: 2039
April 20: 1,211 ATH: 1272
March 20: 1,058 ATH: 1272
February 20: 1,044 ATH: 1166
January 20: 894 ATH: 1122
December 20, 2016: 793 ATH: 1122

The question is, "How long will it be before see a new all time high?" Zoom out. Uncertainty will make people fearful.

[Shyheels]

Volatility is one thing but 30% in a day? This is bubble stuff

[kneehighs]

For people with a risk tolerance for btc, remember the charts.

In the context of corrections, what happened to btc isn't any different from it's inception.

Images courtesy of CNBC Fast Money, Chart Master Carter Worth.

The best is yet to come!

[Shyheels]

Well, I see trading has been suspended on some exchanges 

http://www.bbc.co.uk/news/business-42457983

I'm thinking I like roulette and the horses better and better.

[alphax]

 

 

Graphs?  We got 'em!

from  https://www.cnbc.com/2017/07/20/bitcoin-bubble-dwarfs-tulip-mania-from-400-years-ago-elliott-wave.html

Compare to the last logarithmic chart on Bitcoin prices in the article.

@kneehighsBy the way, you never answered my question:  When would you be willing to sell to take profit?

Edited December 23, 2017 by alphax

[Shyheels]

Indeed, in 1636, tulips were going nowhere but up. You'd have been mad not to get in!

[kneehighs]

11 hours ago, alphax said:

 

 

Graphs?  We got 'em!

from  https://www.cnbc.com/2017/07/20/bitcoin-bubble-dwarfs-tulip-mania-from-400-years-ago-elliott-wave.html

Compare to the last logarithmic chart on Bitcoin prices in the article.

@kneehighsBy the way, you never answered my question:  When would you be willing to sell to take profit?

Hi @alphax currently and subject to change I'm not planning on selling until around April 2019 or April 2020.  When newcomers get their tax bill, I think it'll create a bearish sentiment towards crypto.