Is Bitcoin the Next Big Thing?

[websaway]

Just to put a bit more meat on the bones...

In October 2011 (95% crash territory) there were about 7,500,000 BTC issued. At the pre-crash price of $35, that meant the total capitalisation of Bitcoin was US$262,500,000.

When BTC hit its all-time high of $19,290 there were about 16,750,000 BTC outstanding. So the total capitalisation of Bitcoin was US$323,107,500,000.

In other words, the BTC market during the recent crash was 1,230x bigger than it was in 2011. So there is absolutely no way in a trillion years the two crashes are in any way "comparable".

The fact that somebody on Quora tried to equate the two to justify recent events suggests:
A) mistaken delusion
or
B) deliberate attempt to mislead their audience

I think that's just stating the obvious but, as experts do, making it sound more complicated than it is.

 

[Edwin]

I think that's just stating the obvious but, as experts do, making it sound more complicated than it is.

It's not "obvious" because the original nonsense on Quora got over 70 upvotes.

Although it may be obvious to the Acorn audience, admittedly. We're all smart folk in here.

 

[ausername]

That will be the future (generally, I mean - not just lapdance clubs): once biometrics are perfected to 99.999% accuracy, people will be required to provide various things (retinal scan, thumbprint, etc.) that nobody else will be able to forge, and that will be the most solid guarantee possible that a transaction is valid and solicited.

Will there be an increase in people with missing thumbs then?

Seriously though, can a thumb be chopped off and still 'work' for this purpose?

If people are willing to throw acid in peoples faces for being slighted.... then they'll chop off a thumb to use a credit card?

 

[Edwin]

Will there be an increase in people with missing thumbs then?

Seriously though, can a thumb be chopped off and still 'work' for this purpose?

If people are willing to throw acid in peoples faces for being slighted.... then they'll chop off a thumb to use a credit card?

There will be teething problems, but eventually I expect there will be 2, 3, 4 metrics used and it will be impossible to forge or get around the security. For instance:
- finger/thumb prints
- gait analysis
- retinal scans
- smell
- ear shape
- facial recognition
- voice print
- heartbeat pattern
- vein matching (most likely on the palm)
- DNA sample (tiny skin scrape, so thin you literally wouldn't notice it)

Each of the above, and several more, have been suggested as things that could be used to distinguish one person from another with a very high degree of accuracy. Of course, you have to get each individual test working very well before you start combining them, otherwise you end up compounding errors and rejecting a lot of people (false negatives).

You could also consider using the unique shape and weight distribution of your posterior when seated, or the microbiome in your excrement, but I suspect most serious businesses would draw the line somewhere before that!

Timeframe? Not sure, but let's say 15-25 years. Hard to see how in a quarter of a century we'll still be using rudimentary stuff like pin codes and passwords as protection, or even multi-factor authentication. Nothing's as secure as a living, breathing, unique human. Not by a long shot!

 

[ian]

It's not right for the bank to refuse you access to your OWN money because you might not make mortgage payments etc. I don't think that's an excuse that would hold up in a legal challenge.

Agreed, a bank cannot make judgement on what they consider to be a good or bad decision in the case of a customers own money. If we get to that stage of control, then certainly cryptocurrency would become even more important.

 

[martin-s]

If you only look at % and ignore that, it's beyond useless commentary. Sorry. Don't mean to be rude, but % just is meaningless in a vacuum.

That's not true because it doesn't factor in the buyer's net worth. A % is the only fair way to judge it.

 

[Edwin]

That's not true because it doesn't factor in the buyer's net worth. A % is the only fair way to judge it.

So are you really saying that something dropping from e.g. £10 to £1 is more significant than something dropping from £10,000 to £4,000, across millions of such drops?

 

[ausername]

So are you really saying that something dropping from e.g. £10 to £1 is more significant than something dropping from £10,000 to £4,000, across millions of such drops?

Yes, of course.

It is all measured in percentages.

If you own 1000 units worth £10 each, or 1 unit worth £10000.... so the same 'value', then £10 to £1 is a hell of a lot more significant.

 

[RobM]

You just introduced the fact there are 1000 units of one and only one unit of the other.
This is not the case. I don't think anyone is really too fooled by the % talk though - it's some people that need to make themselves feel better. Reality doesn't care about statistics.

 

[Edwin]

Yes, of course.

It is all measured in percentages.

If you own 1000 units worth £10 each, or 1 unit worth £10000.... so the same 'value', then £10 to £1 is a hell of a lot more significant.

But I've already shown that in the 2011 crash the total amount "lost" across the whole market was over 1,000x less than that "lost" in the last few weeks.

Still makes zero sense I'm afraid. I'd be annoyed to lose £9 (if I lost my nerve and sold) - I'd be gutted no end to lose £6,000. One is a sum I could laugh off, the other...

After all, the argument based on % is being advanced by Bitcoin proponents to downplay the recent correction. That's what I am arguing isn't in any way a fair comparison.

You have to look at the amount people lose PER Bitcoin, surely?

Of course if they own 50 Bitcoin or 500 or 5,000 they're going to lose 50 or 500 or 5,000 times more. But the starting point is their loss for every Bitcoin they hold.

 

[Edwin]

Reality doesn't care about statistics.

That would make a pretty decent t-shirt slogan!

 

[RobM]

lol 'There there son I know you lost 5 grand on the last transaction but look on the bright side... you lost less than you would have years ago percentage wise.'

 

[Edwin]

If you own 1000 units worth £10 each, or 1 unit worth £10000.... so the same 'value', then £10 to £1 is a hell of a lot more significant.

If you had 1000 Bitcoin worth £10 each (which they were at one point) then they lost something in excess of £8,000,000 in value during the recent correction. Whereas the same 1,000 Bitcoin only lost about £20,000 during the 95% crash in 2011.

 

[Edwin]

Dipping randomly into some of the top-end video cards (by clicking on individual models you can see their recent price history)...
https://uk.pcpartpicker.com/products/video-card/#c=390

It looks like they've zoomed up in price even further in January/February despite the huge crypto correction. Or perhaps it's because of the correction? Does anyone know if the difficulty rate has adjusted itself enough as a result of the drop in crypto values to improve expected ROI?

 

[ian]

Dipping randomly into some of the top-end video cards (by clicking on individual models you can see their recent price history)...
https://uk.pcpartpicker.com/products/video-card/#c=390

It looks like they've zoomed up in price even further in January/February despite the huge crypto correction. Or perhaps it's because of the correction? Does anyone know if the difficulty rate has adjusted itself enough as a result of the drop in crypto values to improve expected ROI?

No, it is even worse than before. Right now, I can only assume it is a case of buyers doing miscalculations, or accumulating in the hope of improvements. Naturally if the difficulty remains the same, but prices start going back up, then there is profits to be made, but right now, I see the ROI being a huge risk! I was about to buy a 6 GPU (1070) rig in January, in fact, I ordered it and then cancelled prior to despatch...glad I did now.

 

[Edwin]

No, it is even worse than before. Right now, I can only assume it is a case of buyers doing miscalculations, or accumulating in the hope of improvements. Naturally if the difficulty remains the same, but prices start going back up, then there is profits to be made, but right now, I see the ROI being a huge risk! I was about to buy a 6 GPU (1070) rig in January, in fact, I ordered it and then cancelled prior to despatch...glad I did now.

Had you bought the 6 GPUs a few weeks ago, you could probably have listed them on eBay at a decent profit. But that's with perfect hindsight, which none of us have...

 

[Edwin]

BTW, a little FYI just in case someone is sitting on a stack of crypto and HODLing like mad...

By some ultra-wealthy enthusiasts, Lamborghinis are considered to be "the single acceptable way to spend money in the Ethereum cryptocurrency community," according to The New York Times.

https://www.cnbc.com/2018/02/07/bit...-buying-lamborghinis-with-cryptocurrency.html

 

[martin-s]

So are you really saying that something dropping from e.g. £10 to £1 is more significant than something dropping from £10,000 to £4,000, across millions of such drops?

I'm saying that if you're sensible (not a given with crypto, obviously), maybe you just put 2-5% of your cash into it.

Whether that's £100 or £10,000, it's the % loss that makes it material *to you*

 

[Murray]

If you had 1000 Bitcoin worth £10 each (which they were at one point) then they lost something in excess of £8,000,000 in value during the recent correction. Whereas the same 1,000 Bitcoin only lost about £20,000 during the 95% crash in 2011.

You would hope people who bought in recently have a lot of cash to burn

How I value £5 another person might value £5k

 

[Edwin]

You would hope people who bought in recently have a lot of cash to burn

Yes, you would. It would be great if the world worked that way.

However evidence from past bubbles suggests that it’s very much those that can least afford to lose the money who pile in when things get most bubbly.