When you look at the proliferation of alt coins that have come to market, there is always concern about a bubble and also outright scams.
BusinessInsider.com published an article that quoted VC Bill Gurley and his opinion of the recent rise in ICO’s. The article is a good read whether you are a bull or a bear on crypto.
From the article:
- Smart people like VC Bill Gurley are beginning to worry that cryptocurrency ICOs are a bubble.
- People are investing in Bitcoin and other digital coins even though they hold no equity value and offer no claims on any kind of underlying asset.
- On that definition, ICOs are actually worse than dot-com stocks in 1999 — at least back then investors owned a piece of a company with a revenue stream.
- Crypto bulls keep saying that Bitcoin is “an established ‘store of value.'”
- The problem is that the value being stored is simply everyone else’s agreement that there must be value here. There is no other asset. And that is what a bubble looks like.
Anyone know if there are any BlackFriday sales for bitcoins?
Yes, it is Bitcoin Black Friday. lol. You don’t sound like you are up on Bitcoin as that is essentially the only Bitcoin sale day every year and it is endlessly discussed. One year someone set up a knock-off with a .info domain and took everyone’s Bitcoin who placed orders. The product offering is always pretty dismal but you can get gift cards through some services so you can spend in that way.
the technology has future. probably bitcoin will have future.
but for now, we simply have the biggest bubble on human history since there are records…
“The problem is that the value being stored is simply everyone else’s agreement that there must be value here.”
So it’s exactly like money in every way.
Except that a cryptocurrency is tied to a proved mathematical equation with finite results whereas money is tied to gold … but where is the gold ?? IMHO, the problem is that there are way too many non-technical people talking about blockchain, crypto and labeling prices without the slightest idea.
The REAL value is the ability of sending a message without a messenger ( or trading, or storing, or sharing,etc..). The framework makes it happen, not the *coin.* word.
LOL IKR
“So it’s exactly like money in every way.”
Not at all. As also clearly explained in the article, “money is backed by a central bank guaranteeing its value with actual assets on a balance sheet”, even if we are not anymore under a gold standard system.
Behind money you have a productive economy, while under crypto-currencies you have no underlying assets whatsoever, NOTHING …
History repeats itself … and also this time we’ll see a lot of people left holding the (empty) bag … that’s Fools Money folks … 🙂
Happy Thanksgiving everyone!
“money is backed by a central bank guaranteeing its value with actual assets on a balance sheet” Sorry, but the US Fed does not have the assets to cover the $14 trillion issued in M2, so your claim is untrue.
“Behind money you have a productive economy…” Behind crypto-currency you have the same productive economy that you claim is behind fiat currency.
but you also have a mathematical equation with finite results in lieu of Gold – you can’t fake that.
on top it runs on a framework that eliminates the messenger of the message.
And that’s what mining is, mapping these finite results and you would be literally finding money, and you can trade that without a middle-entity. Hence, the health of a crypto-currency analogously to paper money is a totally different sensor altogheter.
Crypto mining is a “non business”, a useless “business of nothing” … besides being very energy consuming, with a horrible environmental impact, a gigantic waste of energy with zero value for the society as a whole.
Here we go with more marketing stunts for crypto currencies … those guys are nuts …
Maybe you should read again what I wrote.
I said “money is backed by a central bank guaranteeing its value with actual assets on a balance sheet, even if we are not anymore under a gold standard system.”, which means not all money is covered by assets, but a good part it is, unlike it was under the Gold Standard (until 1971), where all outstanding money was guaranteed/backed by gold.
“Behind crypto-currency you have the same productive economy that you claim is behind fiat currency.”
Not at all, go back studying basic Finance, it’s better … Behind crypto currencies there is NOTHING …
but Andrea, the fact that you can arrive at the money trace by a mathematical equation is something that eliminates fraud. there’s no way around that. you trade that currency with someone else and there’s no middle entity, no regulators. it’s you and the pub keeper. and the veracity of the coin is tied to the mathematical trace, you simply -cannot- fake it.
IMHO, that’s the value and it is very different from paper money -goods itself will have a different, real value; that’s the bubble that’s coming because you are right, there’s way too many people( and I mean VCs and billionaires ) that are not technical creating delusional hype (EX: InitialCoinOffering.* ), after the bubble what will prevail will be crypto-currencies with real mathematical equation, because you simply cannot fraud that -and goods will then have real value – no more phones at $1000 … BTW: I am referring only to BitCoin of which I have mined in the past and it is the only reason that I have some of them ( it costed me $80 years ago); I havent checked ethereum or alikes yet, but when I do, that is the only measurement that I will look for -and to do so, you mine it, why buy it ?
These discussions are awful. This is like listening to Rush Limbaugh and Al Gore discuss climate change …. neither person actually has a clue. Bitcoin is full of “advocates” who are actually cultists who foam at the mount anytime someone says something they perceive as a negative towards Bitcoin. These advocates, in their fervor to promote, Bitcoin spread all sorts of misinformation and false claims. Then uniformed newbies see all this crap and they think the whole thing is some kind of scam. However, this is a tremendous business opportunity because if you can gain an in-depth understand of what is going on you can profit from all the people who have no clue.
Bitcoin being tied to a mathematical equation does give it value. There are hundreds, if not thousands, of coins that use the same mathematical equation and it does not give them value. People give them value and it is based on the “network effect” of an ecosystem of people who use and trade the coins.
Bitcoin certainly does not “eliminate fraud” as there is plenty of fraud in the crypto world. It provides a trustless way to do transactions that cannot be easily reversed. Depending on the specific situation it could either eliminate fraud or promote fraud.
My favorite stupid claim is people who claim Bitcoin will end wars. the theory is that the whole world will use Bitcoin as the one and only currency. Then they say that governments will no longer be able to borrow to fund wars. One of the most prominent people in Bitcoin (Bitcoin Jesus) promotes this nonsense. Of course the world is not going to go to one currency, they are going to use many currencies that fits their needs (there goes the inflation argument as well) and if government can’t borrow they also would not be able to fund things like roads so it is unclear why just war is singled out.
Can you buy a put?
If you’re joking, it happens that futures are about to begin fairly soon.
Bitcoin is not designed to be an investment product, it is designed to allow trustless transactions. If you want to use like some kind of investment vehicle then you have to put trust into an exchange and you are no longer conducting trustless transactions. That sort of eliminates the whole purpose of Bitcoin which is not to trust a third a party. There have been several entities trying to offer Bitcoin investment products like you discuss. One problem is that anyone with a private key can transfer the coins to a pseudo-anonymous Bitcoin account. That means an exchange operator can easily transfer the funds to an account he/she controls and they just claim they were “hacked.” These “hackings” happen to numerous Bitcoin exchanges (MyBitcoin, BitFloor, Mt. Gox, CoinLenders, etc.) getting insurance and regulatory approval to open one of these exchanges is not easy.
Domain values, without a website, are not going up from here today.
Cryptos are going up in value for the next 10 years…so stop watching and get in now.
Buy BTC, ETH, LTC.
Buy Ethereum ETH and hold…it will pass BTC in market value.
“Buy Ethereum ETH and hold…it will pass BTC in market value.”
And the good argument for that is?
He owns it.
CRYPTOCURRENCY is here to stay.
Of all of them XRP has legs as it is a real business solution for finance industry. The rest may go up down around and back again, eventually failing or winning, have fun. Buy when there is blood, sell when its double digit green.
XRP is not a cryptocurrency, it is fuel to do transactions on the Ripple platform run by OpenCoin, Inc. The Ripple idea actually predates Bitcoin. It is designed to make trading dissimilar items easily but it is not entirely trustless. XRP’s are how the company collects transaction fees. XRP’s are need to conduct a transaction and the company creates them in order to fund their operations. I am not saying it is good or bad, just completely different than Bitcoin.
Milly,
what do you mean by “There are hundreds, if not thousands, of coins that use the same mathematical equation” ?
They are called altcoins. They take the Bitcoin software, make a few changes, and launch a new coin. Litecoin, dogecoin, etc, etc.
Hi Milly,
I dont think you understand how crypto-coins are used with finite mathematical results.
How could you fake result #12th of the PI recursion ? You cant. So if it’s taken or
accused in the ledger ( block-chained distributed, remember: no messenger, just the message) how is it that the same equation can be used, you said and I quote: in “hundreds, if not thousands, of coins the mathematical equation” ??
That’s the precise problem with ICOs.. you need to be able to separate what’s good and what’s bad. How do you know if a physical coin ( say XE.com ) is inflated on its exchange rate ? You dont. You can speculate and analyse the market, but that’s about it. Within a crypto-currency then you would be able to measure that. Anything else is BS.
You are mixing up all sorts of things. The finite number of coins is based on a programming parameter. It has nothing to do with any math problem such as the cryptography problem solved by miners to solve a block. It also has nothing to do with the cryptography used to verify the blocks on the blockchain. Dogecoin uses the same math to verify the blockchain and a similar crypto problem to mine but they set a different programming parameter so there is no limit to the number of coins produced.
The notion that Bitcoin is going to solve some sort of inflation issues in the economy is one of those completely bogus arguments pushed by cultists. For that argument to be valid then everyone would have to use Bitcoin to the exclusion of almost everything else. In fact the exact opposite is happening. New systems are being developed all the time and people put value in them so the fact that Bitcoin is limited to 21 million coins is not really relevant at all to overall inflation. Not that Bitcoin is bad, it just doesn’t do many of things claimed by the people claiming to be advocates.
Am investing in ICOs with established team and products, hoping to get profits out of them in future,its cost effective as i dont have to pay for renewals like am doing for other bunch of domains yearly
Most of these things do not have anything close to “established team and products.” Most of the people involved in Bitcoin are teenagers and kooks who have no clue about running a business or anything outside of Bitcoin. Some of the most knowledgeable people about Bitcoin probably would not be able to cross the street alone without being hit by a bus. lol. You really need a very in-depth knowledge of the culture to understand what is going on.
I have spoken to some ex-employees of these startups. They engage in illegal hiring practices, ignore regulation, engage in huge amounts of sexual harassment, and they generally think they know everything because they discovered Bitcoin. Then when everything fails they claim a “hack” and take all the funds. They drive the VC investors nuts.
Cryptocurrencies outpacing investing in internet-oriented early stage companies does not, by itself, substantiate the investment value of cryptocurrencies.
Both forms of investment are distinguished by the fact that investors are not provided with registered securities in return for their capital. To protect unsophisticated investors, the U.S. government limits investment in early stage companies (and entities not issuing securities in return for investments) to qualified investors, i.e., individuals with more than $1 million in net worth (excluding the value of their home) or in excess of $200,000 in annual income in each of the previous two years ($300k for those with joint income).
The logic of these restrictions is that it would be too risky to allow unsophisticated investors to participate in investment schemes that leave investors unprotected by securities regulations.
What are investors with “an appetite for risk” to do if they fail to meet the threshold for early stage investing? Outside of cryptocurrencies and domains, there are not a lot of legal investment opportunities promising high ROIs. So here we find ourselves—in one casino or another.
Are cryptocurrencies attracting capital that would otherwise flow to early stage companies? Obviously. But most of the tulip bulbs appear to be purchased by unsophisticated investors who will be treated to a “character building experience” if and when their cryptocurrencies lose most of their value.
but how do you enforce that giving that there is no middle entity in the trading of block-chained digital asset, such as crypto-currency?
You are confusing “block-chain digital assets” with how the coins are created and distributed. In Bitcoin you don’t have a central entity that creates the coins unlike things Ripple and Ethereum. Ripple and Ethereum are created by a company and used to fund the developers. There have already been numerous regulatory enforcement actions. Once of the more notable actions was against Ripple and they were fined $750k for their dealings with “Bitcoin Jesus.” Many of these coin launces are actually investment products that are heavily regulated. For instance, once guy on here wanted to launch a coin that was tied to his domain portfolio which is clearly regulated just like offering stock in a company.
I think you are the one confused Milly. I’m not confusing anything. look it up 🙂
All you do is repeat circle-jerk stuff you read on Reddit. I looked all this stuff in years ago. FINCEN has a faq about it describing what is regulated and what is not based upon how the coins are distributed.
BTW – I am the one who got the official ruling from FINCEN that Bitcoin miners did not have to register as money transmitters. You can look that up on Coindesk as they did an article about it.
I find nothing compelling about the cryptocurrency argument, much the same way I find nothing compelling about the stock market. Maybe I’m wrong. I’m into internet real estate, and actual real estate–assets where I actually have physical control over what happens with them. I don’t understand the pushing from domainers to get into what amounts to just another form of currency. I don’t trade in Loonies, or pounds, or euros, why would I care??? Maybe someone smarter than me out there can explain it to me.
Most of the stuff you see about Bitcoin is wrong and many people don’t understand it. That is where the investment opportunities exists.
Bitcoin’s value is in providing trustless transactions. For instance, I can send $1 million in value to someone in China at any time of the night or day for a few dollars in fees and nobody can stop or reverse the transaction. That is very compelling in certain situations and that is the reason Bitcoin value has increased the way it has.
Dear Milly, I’m not reading stuff in Digg. I’m a mathematician whom happens to be a domainer.
The first thing to need to learn in Bitcoin is to sift through all the misinformation which is about 95% of the info that is out there. Listen to the group at Princeton University., some of the people at MIT (at least the ones who don’t try to politicize Bitcoin), and the people at Coin Center to get valid information. Most of the other sources are kooks and cultists.
Hello,
I love the idea of Bitcoin and cryptos, however I can’t stand the idea of sending all my ID information, and a photo of my face with my passport to an unknown websites potentially as fraudulent as mount gox.
So I cannot buy bitcoin/cryptos eventhough I want!!
Everybody talks about cryptos as if they were so easy to get… But has everybody done all the identification process required by almost all platforms?
Or are there ways to buy bitcoins anonymously and I am not aware?
Thanx in advance
In the old days it was much easier. You could buy mining equipment and mine for yourself or you could just buy Bitcoin with paypal from another user on a discussion board. In fact there is an old thread from 2010 where someone tried to sell 10,000 bitcoins for $50. He kept mumping the thread and nobody bought them. something like a hyphenated .biz domain thread. One famous early transaction is the guy who ordered pizza for someone and had them reimburse him with Bitcoin. The regulatory stuff started when Mt. Gox started to get big and the regulators took notice. You can work for Bitcoin or sell products but most people nowadays go to exchanges and go through all the verifications. I have gone through the process several times. Have a color copy of a driver’s license, and some recent utility bills that shows your address, and a bank account and you should be able to get through it. some people use localbitcoins to buy Bitcoins for cash in person but that can be dangerous, expensive, and may be illegal depending on the circumstances.
Milly Bitcoin, thank you for your answer. Well, we can imagine what the scandal in the next years will be, right? One or several of those exchanges gets hacked and huge amounts of highly sensitive information becoming public /ending up un the dark net…
Aren’t you concerned about this?
Thanx
Excuse me for chiming in…the next scandal is actually happening right now. Millions of Tether which are supposed to be a stablecoin are being printed and artificially driving btc through the roof.
Problem is there’s no proof that there is any USD backing it and has never been audited. Affects not just Bitfinex but many other sister exchanges. Going to be catastrophic for crypto when the pump is done, and a very small window for exit into fiat. Support levels will be cut like a ginsu through butter.
Whether it happens this week or next year, I for one am not waiting for the tsunami, profit cashed and out.
Carry on.
What is a trustless transaction, and why would I want one? In response to the “I can send $1,000,000 day or night…” I have that ability already. A wire transfer at Wells Fargo as well as my small town community bank is about $14. We also have BOA, Morgan Stanley, and Merryl Lynch to name a few who would be happy to wire my funds anywhere. I wont send $1,000,000 to anyone or anywhere unless i do trust them…
A trustless transaction means that there is no third party (bank, credit card company, etc.) that can stop or reverse the transaction or set rules. You have to trust the person you are sending the funds to because the transaction cannot be reversed so Bitcoin is not really a replacement for credit cards as many Bitcoiners claim. BOA will not allow you to send $1 Million to china. The credit card companies won’t allow you send money to online gambling sites or legal marijuana distributers in spite of these things being legal. There are also restrictions to certain areas of the world. In some parts of the world people put money in banks and its gets seized or the government prints too much and devalues their savings. I tried to send a $500 wire to someone in eastern Europe one time to buy a domain and after 2-3 weeks I finally gave up with the bank and mailed a postal money order. with Bitcoin I could have completed the transaction in a few minutes. There are just a few examples of trustless transactions where Bitcoin can be useful. Everyone in the world does not have access to all sorts of financial systems like people in the US and Western Europe.
Like Milly I’m an old timer. And I just wanted to say that his/her comments above are 100% spot on. Any newbie needs to absorb every word he/she has written because this is looking more and more like the internet bubble as we approach BTC $10k.
As a matter of fact I just cashed all of my btc and alts going back to 2012 into FIAT via coinbase, first time ever I’ve transferred value back into the “real world”. The cap gains are well worth paying now and all of that shitcoin-wallet-compiling of yesteryear which was just for fun has paid off *very* handsomely.
Seriously, the amount of hype and misinformation in crypto is staggering now, and that’s not even talking about the ico whitepapers that want to make you throw up. Everyone thinks they know “bitcoin” but it takes years to truly get your arms around it, both technically and politically along with a dash of life experience. Throwing a 1080 into a spare box is now considered the same as becoming an expert in trustless transactions. Oy it’s cringeworthy.
It’s getting dangerous out there folks, take heed.
I’m still wondering who will make me a solid offer, on Crypto.Show, to keep up with all that is going down/up in this market? ?
Not me, that’s for sure. I wouldn’t even hand register it.