Fruitbat
Master Don Juan
- Joined
- May 3, 2013
- Messages
- 3,426
- Reaction score
- 2,470
i posted too soon, read the rest of my post now mateOf course it is...all crypto is built on blockchain technology.
i posted too soon, read the rest of my post now mateOf course it is...all crypto is built on blockchain technology.
I suggest you read up on DeFi.i agree.
Blockchain isn’t crypto though is it?
the point I am questioning is whether etherium, BTC, ripple etc, what would be the need for them if you had a centrally controlled digital currency?
It would be fairly easy for a government to say we control digital currency and you can’t trade with the emergent currencies. I mean, why? I can pay my mortgage with fiat, or I can go through all the effort of buying one of many currencies and pay with that. What’s the point in changing?
people tend to do the easiest thing. Logging on to coin base. Accessing your app, working out what you’re exchanging at, paying….while you’re still generally getting paid in fiat…what’s the point?
If it’s widespread adopted, let’s say etherium or ripple, so your employer pays you in that. Your pension, social security, that’s going to work off a decentralised system the government doesn’t control? Not how the world works.
massive risk. Huge currency risk for everyone. Economics are vastly complex. How many of these currencies will collapse?
If you ask me, eventually you will just get digital fiat. That’s where this is heading.
the question again, what does BTC and etherium, ripple etc, what do they do that a central bank currency can’t do?
If the supply is fixed, how do you avoid huge inflationary/deflationary spikes when you don’t have the ability to employ monetary policy?
You cant even really have one currency for the EU. Hell, the USA or U.K. could do with two currencies with differing purchasing power and interest rates. How on Earth this can replace the current system without enormous instability is beyond me. It’s a nice idea but without central oversight, it is going to result in some huge annomalies and being honest,the idea of these independent currencies replacing the banking system and central banks just isn’t possible. It’s like saying we are going back to trading in gold.
the current system is the way it is for good reason. I just can’t see how this can happen without central management. Economics are too complex, the economy is managed by central banks who control liquidity, the risk free rate, inflation etc. You cant do any of that with independent currencies.
I get a strong “we are the 99% and we can smash the greedy bankers vibe” from crypt advocates but I don’t get many answers on this. Blockchain is one thing, overthrowing central banks and the banking system on the other hand, isn’t possible or desirable
If you took out a mortgage in BTC about 2 years ago for £200,000 you’d now owe about £2M.I suggest you read up on DeFi.
When was the last time you were paid 10% APR to take out a loan to buy a house?
Yes...you read that right. You get paid 10% APR to borrow money.
Most of those assumptions are wrong.If you took out a mortgage in BTC about 2 years ago for £200,000 you’d now owe about £2M.
One quick check of Defi (admittedly I haven’t researched it fully) says that it’s a P2P lending network . Not backed by collateral.
would you pay someone 10% to lend them your own money?
the converse of this must be true. If borrowers are paid 10% on their liabilities, then savers are paying 10% in negative interest.
The concept of negative interest rates aren’t sustainable without inflation. It’s a law of nature.
The entire system of asset pricing collapses with a negative risk free rate. CAPM doesn’t work, the bond market collapses. Equity markets don’t exist because the magic crypto tree can provide returns in excess of dividend streams.
what you’ve suggested doesn’t make sense. The money has to come from somewhere. If it comes from savers then surely nobody is incentivised to save at negative rates. If it’s coming from a third party or “magic money tree” if you will, that’s only possible through a central agency selling £10 notes for £9.
Me thinks a lot of this is the blind leading the blind.
If you currently have too many women chasing you, calling you, harassing you, knocking on your door at 2 o'clock in the morning... then I have the simple solution for you.
Just read my free ebook 22 Rules for Massive Success With Women and do the opposite of what I recommend.
This will quickly drive all women away from you.
And you will be able to relax and to live your life in peace and quiet.
You're completely misunderstanding lending.If you took out a mortgage in BTC about 2 years ago for £200,000 you’d now owe about £2M.
One quick check of Defi (admittedly I haven’t researched it fully) says that it’s a P2P lending network . Not backed by collateral.
would you pay someone 10% to lend them your own money?
the converse of this must be true. If borrowers are paid 10% on their liabilities, then savers are paying 10% in negative interest.
The concept of negative interest rates aren’t sustainable without inflation. It’s a law of nature.
The entire system of asset pricing collapses with a negative risk free rate. CAPM doesn’t work, the bond market collapses. Equity markets don’t exist because the magic crypto tree can provide returns in excess of dividend streams.
what you’ve suggested doesn’t make sense. The money has to come from somewhere. If it comes from savers then surely nobody is incentivised to save at negative rates. If it’s coming from a third party or “magic money tree” if you will, that’s only possible through a central agency selling £10 notes for £9.
Me thinks a lot of this is the blind leading the blind.
That’s leveraging. Nothing new, indeed.You're completely misunderstanding lending.
Buy 500k in bitcoin
Borrow 200k to buy a house, loan or outright
Borrowing bitcoin will cost you about 0.3% currently (https://app.aave.com/markets)
Lending on a house is about 3%
Bitcoin grows 2x a year at minimum, let's go with a very modest 10% growth...
After 1 year, you have
550k in bitcoin
200k on real estate + asset gains
You've paid about 1k in interest on your bitcoin loan
Net = 49k
Most billionaires do this crazy stuff all the time. And it's primarily why they dont give a crap about raising taxes. They take loans out on their stocks, which does not qualify as taxable income. Their collateral appreciates faster than their loan rate.
Defi allows everyone to do it.
Crypto allows anyone to be wealthy, our current financial system makes it much more difficult.
Here's another example...
I have 25k on polygon in stablecoins which are pegged to the USD. I am currently getting about 50% APY.
I think you need to separate Bitcoin from the rest of crypto. They are completely different animals. Bitcoin is decentralized monetary energy, it's simplicity is a feature not a bug. The inability to change the rules or a single group having large influence makes it the best candidate to be a global currency of the internet. There is no central point of failure or choke points for governments to have meaningful control over it. You can't really put it in the same box as a Ethereum, ripple or other crypto. Some of those will be great too, just vastly different roles. The difference between btc and a central bank currency is the inability for a govts to erode its value or seize it. For example, if you wanted to leave your country with your wealth they can freeze a bank account, they wouldn't be able to do that with Bitcoin in self custody. If you have specific concerns, list them out and i'll address each one to the best of my abilities.That’s leveraging. Nothing new, indeed.
This isn’t getting paid to have a mortgage. It’a gearing your portfolio and using crypto assets to provide growth to offset interest.
Several issues here:
- There’s an assumption that Bitcoin/crypto assets will continue to rise at an astonishing rate.
- Theres an assumption that the lending rate of Bitcoin will remain low and stable.
- I assume you’re borrowing your 500k in Bitcoin. Who is assessing your creditworthiness and how is this debt secured? What happens if you default?
What happens if Bitcoin falls in value and you make a loss?
A lot of this seems to rest on Bitcoin being a risk free perpetual growth machine.
Edit: I’ve had a little think about the realities of digital currencies appreciating ad infitium.
- A closed end asset which can’t be inflated has advantages. However, this absolutely does not mean they can’t lose some or all of their value. What drives the value is partly supply but it’s also demand. It’s dependent on adoption, not supply. It’s mostly being driven by speculation currently, and that draws in more and more speculators - asset bubble.
- Adoption brings its own problems. Let’s say it is rapidly adopted. If the asset is increasing at say, 10% a year due to demand outstripping supply, the cost of goods and services in Bitcoin terms are also increasing, which to all intents and purposes is inflation. This was one of the problems it was supposed to solve.
- Adoption is dependent on governments allowing it which I think is unlikely.
- If it isn’t adopted as a payment system it can still be a digital store of value and will become a risk off asset like gold or the yen, or dollar.
If you could explain the mechanism by which your stablecoins produce 50% a year that would be interesting.
I’m genuinely here for the exchange of ideas on this, and wiling to have any of the above challenged.
Most discussions of crypto I have had with people I know in real life tend to be people who’ve made a ton but are quite obnoxious about it when you try to discuss the mechanics of it and see it as some kind of Robin Hood thing, but I’m just genuinely sceptical of any asset which proclaims enormous returns whilst proclaiming no or limited risk. That is something I know from long experience doesn’t exist and lends me to believe it’s a speculator bubble.
thanks
See replies aboveThat’s leveraging. Nothing new, indeed.
This isn’t getting paid to have a mortgage. It’a gearing your portfolio and using crypto assets to provide growth to offset interest.
Several issues here:
- There’s an assumption that Bitcoin/crypto assets will continue to rise at an astonishing rate.
This is why I used a very very modest 10%. Bitcoin has been averaging (100%) 2x since 2009.
- Theres an assumption that the lending rate of Bitcoin will remain low and stable.
This is correct. However, one year of gains greater than the interest, and you can just pay it off. Defi rates are setup based on market size vs. amount borrowed. People don't generally borrow bitcoin. What you do here is deposit bitcoin, and borrow a stable coin. You're collateral will fluctuate, but your borrow amount remains the same. As long as you're not borrowing 80% of your collateral, you're in good shape.
- I assume you’re borrowing your 500k in Bitcoin. Who is assessing your creditworthiness and how is this debt secured? What happens if you default?
What happens if Bitcoin falls in value and you make a loss?
I am assuming 500k assets in this case. You could do the same for any amount. 500k portfolio in crypto is easily attainable with 1 solid year of crypto investment with an intial investment of 10k. Anyone who is not stupid rich after being in crypto for years is a moron or a degenerate gambler.... no other way around it.
A lot of this seems to rest on Bitcoin being a risk free perpetual growth machine.
Edit: I’ve had a little think about the realities of digital currencies appreciating ad infitium.
21,000,000 bitcoin is the cap. You are correct though. If everyone decides bitcoin is worth nothing, it goes to zero. Same as gold. Same as the US Petro Dollar.
- A closed end asset which can’t be inflated has advantages. However, this absolutely does not mean they can’t lose some or all of their value. What drives the value is partly supply but it’s also demand. It’s dependent on adoption, not supply. It’s mostly being driven by speculation currently, and that draws in more and more speculators - asset bubble.
Correct. That's where the speculative aspect of bitcoin comes in. If you're paying attention, adoption is growing, not shrinking. El Salvador and Brazil being the most recent examples. The US ETF looks like it will get approved on Oct. 19 of this month as well.
"What about China?" They ban bitcoin once or twice every year. . It's a running joke in crypto.
- Adoption brings its own problems. Let’s say it is rapidly adopted. If the asset is increasing at say, 10% a year due to demand outstripping supply, the cost of goods and services in Bitcoin terms are also increasing, which to all intents and purposes is inflation. This was one of the problems it was supposed to solve.
You are incorrect here. Do some real research on cryptocurrency and blockchain. Costs do not increase. There are many people in defi working on this. For example, the Solana blockchain with a locked value of... 45 billion has much lower fees than bitcoin and ethereum. Additionally, they can process 400,000 transactions per second. For reference, Visa maxes out at 1,700 transactions per second.
Bitcoin transactions are fairly reasonable, but Solana is stupid low. You can send 10 million to someone anywhere in the world for about $0.01.
- Adoption is dependent on governments allowing it which I think is unlikely.
Correct. This is the one variable that still is hanging out there. I look at the landscape though. Who outside the US wants the US to remain as the world reserve currency? Also, that doesn't mean you can't make a $hitload of money in the meantime, am I right?
- If it isn’t adopted as a payment system it can still be a digital store of value and will become a risk off asset like gold or the yen, or dollar.
This is where defi comes in. There are countless cryptocurrencies and blockchains, some scams like DOGE and ADA, while many other legitimate projects like Ethereum, Polygon, and on and on...
You're also thinking very small. Crypto can be use for EVERYTHING. NFT is beginning of authentic art and tracking. Contracts, Real estate transactions, or any other P2P transaction can be stored on the blockchain and validated wordwide.
Watch some videos on smart contracts and blockchain.
If you could explain the mechanism by which your stablecoins produce 50% a year that would be interesting.
Moved money into a Cefi (crypto.com), purchased DAI stablecoin, transferred to Defi platform, bridged to polygon network, store in yield farms on various platforms. When APY drops, I will move to another farm. 50% is low, but also low risk. Several medium risk options which can get 100% or more. Many degen options that get you 2-3% per day. Just depends on your risk tolerance.
I’m genuinely here for the exchange of ideas on this, and wiling to have any of the above challenged.
Me as well, and we have both been around SS for a while. I am always learning. I have only been in crypto since March 2021, so I have been through the last part of the boom in April, and the massive crash in May. Rookie lessons, but I am positioned to have an incredible year (e.g. I plan to quit my job and focus on building businesses with crypto earnings).
Most discussions of crypto I have had with people I know in real life tend to be people who’ve made a ton but are quite obnoxious about it when you try to discuss the mechanics of it and see it as some kind of Robin Hood thing, but I’m just genuinely sceptical of any asset which proclaims enormous returns whilst proclaiming no or limited risk. That is something I know from long experience doesn’t exist and lends me to believe it’s a speculator bubble.
Most (if not all) people know $hit about crypto. If they bring up SHIB, DOGE, ADA, or some other pile of garbage, I know they know exactly ZERO about defi, crypto, block chain or otherwise. There's two major camps in the "rich off crypto" category, people that are stupid rich because they got in early and stuck through the ride, and those who bought something like DOGE and got lucky. The second group will likely be poor again at some point.
thanks
So the concern I have mainly is:I think you need to separate Bitcoin from the rest of crypto. They are completely different animals. Bitcoin is decentralized monetary energy, it's simplicity is a feature not a bug. The inability to change the rules or a single group having large influence makes it the best candidate to be a global currency of the internet. There is no central point of failure or choke points for governments to have meaningful control over it. You can't really put it in the same box as a Ethereum, ripple or other crypto. Some of those will be great too, just vastly different roles. The difference between btc and a central bank currency is the inability for a govts to erode its value or seize it. For example, if you wanted to leave your country with your wealth they can freeze a bank account, they wouldn't be able to do that with Bitcoin in self custody. If you have specific concerns, list them out and i'll address each one to the best of my abilities.
If you currently have too many women chasing you, calling you, harassing you, knocking on your door at 2 o'clock in the morning... then I have the simple solution for you.
Just read my free ebook 22 Rules for Massive Success With Women and do the opposite of what I recommend.
This will quickly drive all women away from you.
And you will be able to relax and to live your life in peace and quiet.
I have a nano ledger. I own some XRP, ether and BTC. Invested some fairly low sums before the pandemic so I suppose I’ve made some money, I know I had about 600 ripple at about 30p I think. So that’s probably 3 bagged, but my oil futures have made maybe half to three quarters that and with less risk (or at least less perceived risk)See replies above
Do some research on youtube on smart contracts, block chain, various blockchain networks (avalanche, polygon, fantom opera, etherium, etc.), etc. There is money to be made, regardless of your entry... Just don't go full degen, and don't use leverage.
Let's also not forget that it's permissionless
And the government cannot take it away. Memorize your seed phrase and you can access your crypto anywhere you can get on the internet.
Ding ding ding!- There’s an assumption that Bitcoin/crypto assets will continue to rise at an astonishing rate.
This is where I’m going to sound arrogant or condescending but I’ve been 20 years making money and gaining quals in investment and this really does seem to be the stand out issue. However, markets can remain irrational for incredibly long periods of time and being a person who looks at fundamentals I am always amazed at how strong sentiment is.Ding ding ding!
Most of the people in crypto haven't even experienced one real bear cycle yet and still they believe it's just going to go up forever which make them sound like single mom's promoting ponzi schemes, LOL.
The lack of correction and persistent nature of this bull market is setting up an entire generation for huge losses and cryptos are no exception.
You're welcome to quote me on that. Proceed with caution.
You are confusing crypto with stablecoins. The entire point of a stablecoin is that it's value remains stable.That’s leveraging. Nothing new, indeed.
This isn’t getting paid to have a mortgage. It’a gearing your portfolio and using crypto assets to provide growth to offset interest.
Several issues here:
- There’s an assumption that Bitcoin/crypto assets will continue to rise at an astonishing rate.
- Theres an assumption that the lending rate of Bitcoin will remain low and stable.
- I assume you’re borrowing your 500k in Bitcoin. Who is assessing your creditworthiness and how is this debt secured? What happens if you default?
What happens if Bitcoin falls in value and you make a loss?
A lot of this seems to rest on Bitcoin being a risk free perpetual growth machine.
Edit: I’ve had a little think about the realities of digital currencies appreciating ad infitium.
- A closed end asset which can’t be inflated has advantages. However, this absolutely does not mean they can’t lose some or all of their value. What drives the value is partly supply but it’s also demand. It’s dependent on adoption, not supply. It’s mostly being driven by speculation currently, and that draws in more and more speculators - asset bubble.
- Adoption brings its own problems. Let’s say it is rapidly adopted. If the asset is increasing at say, 10% a year due to demand outstripping supply, the cost of goods and services in Bitcoin terms are also increasing, which to all intents and purposes is inflation. This was one of the problems it was supposed to solve.
- Adoption is dependent on governments allowing it which I think is unlikely.
- If it isn’t adopted as a payment system it can still be a digital store of value and will become a risk off asset like gold or the yen, or dollar.
If you could explain the mechanism by which your stablecoins produce 50% a year that would be interesting.
I’m genuinely here for the exchange of ideas on this, and wiling to have any of the above challenged.
Most discussions of crypto I have had with people I know in real life tend to be people who’ve made a ton but are quite obnoxious about it when you try to discuss the mechanics of it and see it as some kind of Robin Hood thing, but I’m just genuinely sceptical of any asset which proclaims enormous returns whilst proclaiming no or limited risk. That is something I know from long experience doesn’t exist and lends me to believe it’s a speculator bubble.
thanks
The problem is you are arguing about things you are clueless about, not making much sense then trying to turn around and say you know all this stuff.This is where I’m going to sound arrogant or condescending but I’ve been 20 years making money and gaining quals in investment and this really does seem to be the stand out issue. However, markets can remain irrational for incredibly long periods of time and being a person who looks at fundamentals I am always amazed at how strong sentiment is.
markets in the short term are a voting machine. In the long term they are a weighing machine. Crypto is still a voting machine
Agree to disagree, how about we just stay out of each other’s way as we aren’t going to agree. Deal?The problem is you are arguing about things you are clueless about, not making much sense then trying to turn around and say you know all this stuff.
You don't. That's the problem. This is the problem with the politicians as well..their arrogance lead them to make assumptions that are flat out wrong because they don't know WTF they are talking about when it comes to crypto.
There will be massive volatility and a lot of people with get washed out, anything growing at this pace has wild swings. Price is what initially draws people in but is one of the least important indicators of long term growth. Most of these cryptos will not be around in 5-10yrs. Some will be the next facebook, amazon , google etc. Choose wisely.Ding ding ding!
Most of the people in crypto haven't even experienced one real bear cycle yet and still they believe it's just going to go up forever which make them sound like single mom's promoting ponzi schemes, LOL.
The lack of correction and persistent nature of this bull market is setting up an entire generation for huge losses and cryptos are no exception.
You're welcome to quote me on that. Proceed with caution.
Many people are new to crypto. As adoption grows, volatility decreases. Whales still have the clout to swing most cryptocurrencies wildly. However, the most reliable cryptos are still up over time, regardless of the bear markets. Since bitcoin has been around, it has doubled (or more) every year even with such bear markets.Ding ding ding!
Most of the people in crypto haven't even experienced one real bear cycle yet and still they believe it's just going to go up forever which make them sound like single mom's promoting ponzi schemes, LOL.
The lack of correction and persistent nature of this bull market is setting up an entire generation for huge losses and cryptos are no exception.
You're welcome to quote me on that. Proceed with caution.