Bitcoin and Its Major Differences with Tulip Mania ...

The Mandela Effect (Part 4 – The Rationalist Cult Member)

This is a continuation of the Mandela Effect story. For the introduction, click here.
How did you first become aware of the Incident?
Do you believe in coincidences?
Um, what?
There’s a system called Bayesian statistics. It’s a mathematical procedure that applies probabilities to statistical problems. This allows people to update their beliefs in the evidence of new data. For example, if somebody beats the stock market once, we might say they got lucky or it was a fluke occurrence. If somebody beats the stock market five times in a row, we would say that they have got some advantage or technique that works better than everybody else, because the chance of beating the stock market five times in a row by pure chance is pretty slim.
I’m not sure how this relates to the Incident.
That’s because you’re not thinking in terms of Bayesian probabilities. The Incident plays havoc with probability. Things that we might consider the unlikeliest of scenarios – like Trump winning – suddenly start happening all the time. Suddenly the weirdest and most outlandishly random things become normal day-to-day occurrences. Like the number 21, or the colors.
Wait, I sound crazy, don’t I? (Laughs) Sorry, I’ve been told that’s a by-product of spending too much time around the Incident. I’m not crazy, I assure you. It’s just that when you see this kind of… reality distortion, for lack of a better word, it’s a little unsettling. Let me start from the beginning.
We found the subject online, as you undoubtedly heard from (the Silicon Valley Mogul). We listed his predictions out. Understand that at this point, we simply thought he was a newly discovered super forecaster. The purpose of listing his predictions was to quantify accuracy. One of these predictions involved Bitcoin. His prediction was that in approximately five years, Bitcoin would collapse. That sounded strange to me, so I crunched the numbers to see what might possibly happen in five years. It turns out that five years from his predicted date is when the last Bitcoin was expected to be mined. You see, Bitcoin was designed to have a finite limit, with each bitcoin being harder to mine than the Bitcoin before it. This limit was intended to artificially inflate the currency, giving a “first mover” advantage to the people who bought into Bitcoin first. In investment terms, the incentives of Bitcoin seem designed to trigger an early adopter gold rush. So apparently our anonymous super forecaster figures that once the last bitcoin is mined, nobody outside of the bitcoin owners will have any incentive to accept the currency, and the speculative bubble will pop, similar to the Dutch tulip mania of 1637. That didn’t strike me as particularly unusual, until we found out about the subject’s odd preference for the number 21 – their calling card, if you will. Do you know what the maximum number of bitcoins is? 21 million. It led me to wonder if perhaps the subject had some involvement in the creation of bitcoin, since he majored in computer science in college and had some background as a former programmer. Could he have indirectly influenced the creator of Bitcoin? It turns out that there’s no way to be sure, since the creator of Bitcoin is completely anonymous and untraceable.
Once I noticed that, other coincidences started to pop up, all involving the number 21 in some way. For example, the subject had predicted early in the Democratic primaries - in his usual shifty unprovable way involving typing and deletion - that Biden would be President Trump’s most dangerous foe. Subsequent to this prediction, Trump made the historic phone call to the Ukraine that led to his impeachment. You know that the first day of Trump’s impeachment trial was January 21st – isn’t that an interesting coincidence? And wasn’t Trump’s first phone call to the Ukraine also on the 21st? These coincidences started to add up in eerily improbable ways, and I found myself a bit reminded of the story of Macbeth.
There’s more. Supposedly, the subject spent a lot of time on a Reddit forum known as dramawhich was also started on the 21st. I started to wonder if the subject had not just predicted these events, but was also somehow causing them. If so, it would have taken unparalleled planning ability to be able to coordinate these events so far ahead of time.
Then the color thing happened, and my whole perspective changed. One singer seemed to be trying particularly hard to get the attention of the subject by creating music videos with the colors that he had specified. The subject said “Why try so hard to signal to me in the present? Just look into your past, and you’ll already see your own future staring right back out at you.” I looked at her music videos, and I realized that a lot of the previous music videos she had made already used the colors that the subject referenced, even though they were dated from before the subject had ever mentioned the colors. It was as if on some subconscious level, this singer had known about the colors retroactively. Once I realized this, I started to examine the subject’s behavior more closely, looking at past events as well as the future. He liked to visit a nearby cemetary a lot, and while there, our cameras caught him reciting a “spell” in front of a tombstone made of rose quartz. It turns out that there were a lot of those rose quartz tombstones in that cemetary – a suspiciously high amount. Upon further research, it turns out that the reason for these rose quartz graves was because of a hurricane that had ripped through New England in 1938 – on September 21st. That was when my worst suspicions were confirmed. Somehow, the incident was affecting time. Had the gravestones always been rose quartz? Or did the spell make the hurricane happen 80 years ago, and so our memories were changed to fit with the new timeline? Ask yourself this – if somebody sent a single photon back in time and created a butterfly effect that altered history, how would you know?
But surely if time was being altered, somebody would have noticed it, right? Well, it turns out that there’s actually quite a lot of people who say that they’ve noticed alterations to the timeline – it’s just that the rest of us don’t believe them. We laugh at them and call them crazy. Hell, a few years I was one of the people laughing at people like that. Well, who’s laughing now? (Laughs hysterically)
What is your interpretation of the Incident?
At one point, the subject seemed frustrated by our attention. “This has all happened before, and you idiots react exactly the same way each time,” he said. What if that’s accurate? History contains countless stories of witches and wizards. Today we laugh at our ancestors for believing in silly stories about magic and faeries, but rationalists and Silicon Valley executives talk quite seriously about the possibility that we are living in a simulation, and that one might be able to partially hack the “user permissions” of reality itself. What if it’s the same thing?
Imagine that you’re some sort of extradimensional being with the ability to hack this “reality matrix” in a few unique ways. According to the subtext of the Spellbook – which we have been studying very carefully - these things don’t have bodies: instead, they manifest their consciousness to a limited extent in gifted people’s psyches. That sounds a lot like reincarnation to me. How long could such a creature live? Maybe a short time. Maybe forever. We know these things like to keep a low profile, but they aren’t perfect at it. We discovered this one by accident, and in response, it rapidly created a religious cult to defend itself and started distorting reality to advance its goals. Surely this could have happened before. Why are we so certain that this is a new phenomenon? Maybe a lot of the other “secret societies” and “magical orders” that existed throughout history started in exactly the same way. Somebody noticed one of these creatures doing something inexplicable, they reacted to defend themselves, and next thing you know we have a secret cult of influential people all learning magic from their new extradimensional mentor. In other words, exactly like what is starting to happen now. It’s like this thing didn’t even bother to change its MO. (Laughs wildly.) And hey, why would it? Some things are so well optimized that they hardly ever need to change. They go through existence unchanged by evolution because they are already perfectly evolved.
What part of the Incident would you categorize as paranormal or outside the bounds of understanding?
Haven’t you been listening? Pretty much everything about the incident defies explanation. We have prophecies coming true, clairvoyance, strange psychic dreams, vast conspiracies, strange transhuman cults, and fringe science. I know what you’re thinking: I was in this from the start, so supposedly I was one of the people most heavily impacted by the mental effect of the Incident. But the truth is that the only thing I was impacted by is the understanding that our entire understanding of reality is a lie. Who wouldn’t be impacted by that?
submitted by SocratesScissors to scarystories [link] [comments]

Tulip Bubble or Dot-Com Bubble?

I'm sure you already know my sentiments, but let me take a moment and lay out the reasons why.
The Dutch Tulip Bubble (or "Tulip Mania") was a period during the Golden Age when the price of Tulip bulbs skyrocketed in a speculative bubble that burst, in February of 1637. Bidders had run the price of certain tulips (arguably the most gorgeous and lovely ones) to price heights that made no sense.
Speculators were mortgaging houses to buy tulips, and some of the most expensive ones could cost the value of a real house. The Dutch economy was booming, and the citizenry enjoyed the highest financial statndard of living in the world at the time. Significant amounts of discretionary income, coupled with a devaluing of the Dutch Kronur (less and less precious metals had been used for the minting of the Kronur over the previous decades) led to the very real popular concept that the price could only go up.
Of course, after European markets started trading tulip bulbs and the excitement grew to a manic phase, the bottom fell out, and people realized that there is no comparison between the value of a flower and real assets, like houses, horses, food, etc., and the market imploded.
The Dot-Com bubble of the late 1990's was similar to Tulip Mania in some ways (bubbles always are) but significantly different in ways we need to acknowledge and examine.
Speculation is always at the core of any bubble, and Tulip Mania, the Dot Com Bubble and the Crypto Run-Up of 2017 and subsequent collapse in 2018 are no exception. As greed and excitement kick in and override the Human Brain's ability to discern smart from not, the human's tendency to stampede--in either direction, up or down--is significantly increased as the amount of money involved increases.
Capitalist hegemony has imprinted directly on our hippocampuses the concept that the goal is to die wealthy; to die poor is anathema in all segments of human society. "He who dies with the most toys wins!" is a common exclamation.
So when opportunity presents itself, Humans tend to try to take advantage of it, even when the opportunity makes no sense. The Dot Com bubble was one where big industrial financing actually created the monster by throwing huge sums of money at pretty much any idea and team that had an interesting, internet based theme.
eToys.com, Baby.com, et. al., were simply brick and mortar ideas repackaged for the internet--and mostly repackaged to sell the investment. The only difference was the ".com" on the end, and to the investment community, that was more than enough to open the money spigots.
The main difference between the Tulip Mania bubble and the Dot Com bubble is the actual technology. The Dot Com bubble was a ton of fluff, surrounding a strong core of real innovation and futuretech. The Tulip Mania bubble was, for lack of a better term, simply flowers.
So applying these historical times with today's Crypto run-up and implosion, there are obvious and undeniable similarities. The run up in Crypto has made many people instantly and effortlessly wealthy, indeed, some of them are celebrities now, simply because they threw a small amount of money at a project at the right moment and spun the wheel.
And we hear from some of these guys every day. The smaller "players" (I call them 'posers') who made some money by pure luck and now fashion themselves to be experts ("Listen to me! I made money last year and I have a youtube channel!") are all expounding on the virtues of this coin and the shitcoin propensity of that project. In most cases, they were lucky, once. Beware their advice.
The Crypto bubble and collapse is much more parallel to the Dot Com bubble and collapse because at the core of both situations lies a transformative technology and a handful of good projects/companies that emerge at the end of the chaos with strong product and ideas that the public will need, will buy and which will survive. These projects are typically underhyped, undervalued, and are considered "sleepers" at some point in the bubble. This is because instead of chasing financing or chasing popular opinion, they are quietly and methodically perfecting their technologies, their products and their consumer experiences.
These projects are few and far between, interspecked within the flotsam and jetsam of multitudes of "debris projects" that will not survive.
Who remembers MySpace? Who remembers AOL? Who remembers dialup and the AOL "coaster CD?" Who remembers Netscape, AltaVista and Webcrawler?
Amazon, Netflix, eBay, Google, Facebook and a few others were also generated in this timeframe.
Tulip Mania had no survivors, as there was no innovation involved. Simple greed, and when the music stopped, most people were on the wrong side of the chairs.
After the Dot Com bubble burst, however, was a period of quiet, thoughtful and valuable growth. Those who survived the carnage continued on to be come the current Captains of Internet Industry, and have made those who found them, researched them, and invested in them fantastically, famously wealthy.
I believe we are at the point where the bubble has burst, and the dust is settling, in the Crypto bubble. The real and innovative projects have continued their work and are busily planning for the next phase. I strongly believe the Kin Foundation is one of those, and I've invested because of the research I've done.
I've asked some here if they could go back and invest in Apple at the early stages, would they? And the varying and interesting answers I've gotten have ranged from "I'd have better things to do than invest in Apple" to "if Apple were $1 again, there'd be something wrong." Truly chuckle worthy, but telling.
Not everyone will see the opportunity for what it is. Not everyone will take advantage. Weak hands will sell, and weak minds will bash. Only the people who invest with their heads, not just their hearts will make the right moves.
For me, Kin is the Amazon of the Dot Com Bubble. It's where I put my emphasis, my research, my effort and my thoughts. I have invested in many companies and cryptos along the way... I missed out on the Bitcoin rise, but I made money in the Dot Com bubble. I've ridden tech stocks via options for years, and the intrinsically unstable nature of those investments have made the risk of this one much less worrisome.
So the point is this: when the naysayers croak at you, don't worry about it. History is behind us, and if you've done the research I have, you know that Kin is a strong contender to come out strong and vibrant and profitable on the other side.
It's why I'm here, and it's why we're all here. Cheers.
submitted by hiker2mtn to KinFoundation [link] [comments]

Too Many Passwords - The Strings Of Digitalization

Remember those 1980s SCI-FI movies where the action takes place in 2020 and they show a world full of flying cars, holographic advertisements and people with robotic limbs? Well, it’s almost 2020 and we still don’t get to look out the window and see all those things, instead the changes in our society are taking place beneath the surface, in a more toned down manner. It’s all about how money and information moves, how blockchain implementation changes the way we look at everyday tasks. Have you ever wondered how blockchain can potentially transform a city?
Gradual Implementation
Blockchain as we know it has been around since 2008 when Bitcoin was created by the infamous and elusive Nakamoto, but it took almost 10 years for the technology to gain massive popularity and interest. To be more precise, 2017 was the year when the Digital Gold Rush began, Bitcoin and altcoins skyrocketed and all types of ICOs hit the market. From $1,000 to almost $20,000 and from $10 to almost $1,400! That’s how much the first 2 cryptocurrencies (by market cap) moved during 2017 and very early 2018.
Some say “the bubble has burst” but that couldn’t be further from the truth. Indeed, as I am writing this, most coins are down compared to late 2017, but they are still way up if you look at early 2017 prices and besides, a market cannot be gauged by the success or failure demonstrated over 1 year. Also, we shouldn’t overlook one thing: the performance of Bitcoin, Ethereum and other cryptocurrencies shouldn’t be directly associated with the success of blockchain technology because the latter is what can really transform our lives and the cities we live in. Market speculation — buy low, sell high — can be a good source of income if you do it right but real life application of blockchain is the true benefit.
Calling Bitcoin, altcoins or the blockchain a bubble is madness, it’s just like calling the internet a bubble back in the day. Let me tell you about a real bubble: Tulip Mania that started in early 17thcentury in what is now known as The Netherlands. Without dwelling too much into the details, I will simply tell you that some single tulip bulbs were worth more than 10 times the yearly salary of a skilled craftsman. One bulb! Fortunes were made and lost and it all came crushing down in early 1637 when nobody wanted to buy the flower anymore.
The main difference between tulips and blockchain is that with the former, when the speculative incentive is gone, all you’re left with is a beautiful and very expensive flower that nobody wants to buy. Blockchain on the other hand has countless applications across finance, media, healthcare logistics and many others, which are not tied to the price of any cryptocurrency. As the tech becomes more widespread, these uses will become more apparent in everyday life and will gradually transform the cities we live in.
New Payment Methods. Mainstream Adoption Soon?
Many online retailers have already tested cryptocurrency payments and this trend is even present among offline shops. A few online names include Steam (well-known gaming platform), Microsoft, Overstock and Shopify, while offline vendors include KFC Canada, Subway and others. Not to mention there are about 2,200 Bitcoin ATMs in the United States alone at the time of writing. All this means that the world is beginning to adopt blockchain as a form of payment and that more and more retailers will follow.
We can even see changes in the banking system and the way international payments are made. For example, Ripple is actively working with banks and trying to expedite cross border payments as well as greatly reduce transaction costs. One of their partners, Banco Santander has even launched a mobile application for cross border payments powered by RippleNet, allowing to do in just a few clicks what would have taken a long time in the past.
It’s evident that big changes are coming. Maybe not today, not tomorrow, but soon the old ways will become obsolete, just how landline phones or dial-up internet have. I don’t know when flying cars will become a thing but blockchain tech will soon become a lot more noticeable.
Too Many Passwords — The Strings Of Digitalization
Our lives are already dependant on social media, streaming services, online payments and we generally rely on online accounts to define our online personality or to buy stuff. Everywhere you look there’s a “Log In” box and a password you have to remember and type in. If we expect blockchain to take a more prominent role, that means we will be inundated with staggering amounts of passwords to remember.
This begs the question: will we memorize all that information or rely on simple yet functional solutions like Infinitus (INF) to store and protect our online credentials? And since we’re talking about a future where almost everything revolves around blockchain tech and decentralized solutions, I believe it’s only normal that we adopt a blockchain powered dApp to take care of our sensitive information.
Changes Are Coming! Are You ready?
It is no longer a question of if, but when blockchain will see mass adoption. And when it happens will you be ready? And by “ready” I don’t mean having a load of Bitcoins or any other cryptocurrency, but knowing how to use the new technology, how to make the best of its real world applications and more importantly, how to protect your online persona together with your crypto assets. The answer is simple: use a blockchain solution for a blockchain problem and store your private keys with INF — The Smart Designation Repository.
submitted by InfinitusTech to u/InfinitusTech [link] [comments]

My take on the Bitcoin "bubble"

This is sort-of about bitcoin price, but not about the actual value at any specific time, so I hope that's considered OK?
A lot of financial pundits have been saying how the "bitcoin bubble" is going to burst soon, likening it to speculative financial bubbles in the past. I've been mulling on this (no doubt like lots of other people), and this is my take on it. I'm interested to see what other people think about this area?
The bubbles that seem to be raised include Tulip mania https://en.wikipedia.org/wiki/Tulip_mania in 1637, the dot-com bubble https://en.wikipedia.org/wiki/Dot-com_bubble in 2000-2006, and the sub-prime lending, and the sub-prime lending crisis https://en.wikipedia.org/wiki/Subprime_mortgage_crisis that let to the 2008 crash. I'd also include the South Sea bubble https://en.wikipedia.org/wiki/South_Sea_Company of the 1710s in this group, and there are others that could be added. I think all these bubbles have two factors in common.
First, investors are being offered something that either does not exist, does not exist in sufficient quantity, cannot be feasibly delivered, or is never realistically going to be worth as much as is believed. So in the Tulip bubble, the bulbs really were never worth what people though they would rise to. In the South Sea bubble, there was no realistic chance that the level of trade would ever materialize. In the dot-com boom, the idea of internet based sales was ahead of its time, and could not be delivered in the way it was imagined (later, yes, but by that time the bubble had collapsed). In the sub-prime lending crisis, the mortgage holders at the base of the bubble were never going to be able to repay their mortgages and were inevitably going to default.
Second, there is an element of fraud. Each bubble may not have started fraudulently, but fraud (where legally fraud or effectively fraud) arose. Investments were raised by people who would "take the money and run"; financial instruments were used to move unrecoverable debts around in order to obscure their origin (or worse, leverage further loans).
How about Bitcoin?
First, since the use bitcoin to make payments is still very small compared to the total of payments, the first issue does not apply. It may apply some time in the future, but that is not going to happen soon, taking "soon" to mean within the time-scale of any expected crash. So, there is not going to be a moment where people suddenly realise that they cannot use their bitcoins to get some product or service, because that is not what they are expecting in the first place. Sure, some people will cash-in and then use the proceeds to pay for something else, but that is a case of deciding that their investment is now better used elsewhere.
Second, fraud as it occurred before is much less of a problem. People are investing in bitcoin, because they think that is a good idea, and their investment remains there. It is not like a fraud where people give money to another party, and therefore lose all control over it, on the expectation that the other party will later return their money with a profit. Investing in bitcoin is more like investing in gold; people believe that their wealth is better stored in gold than it is in USD or GBP or whichever fiat currency.
So, I don't know whether bitcoin will continue to rise (and if so, how far), and I don't know if it will crash (and if so, how far). But whatever does happen, I don't think it will crash for the reasons that fiat currency investments have crashed.
submitted by mike-es6 to Bitcoin [link] [comments]

Bitcoin rise and fall - be careful!

I decided to write this a few days ago concerning BTC and other cryptocurrencies, enjoy the read and if you have questions about it, feel free to ask: Also like and share this article if you enjoy the read!
Between the years of 1634 and 1637 there was a similar phenomenon to our modern-day Bitcoin (BTC) that we are currently experiencing. It was known as Tulip Mania where the Dutch blew up the price of this flower because of the rarity of it and the increased demand. In one month, the prices inflated just over 2,000% and people were given anything and everything they owned to get a piece of the action. Again, we are seeing something similar with the emergence of cryptocurrencies, but what protected the Dutch and what is protecting us today with these prices? The answer: nothing at all.
Sure, even I have jumped on the bandwagon of buying and selling these currencies and have enjoyed every minute of it, but just as Tulip Mania, we are eventually going to face this infamous “bubble” that major economists are rambling on about. Tulips at their initial release to the Dutch community became a luxury item, where bulbs were being sold at almost 10x what a normal laborer was making during that period. You are certainly seeing something similar with BTC and other coins and the growth that is happening daily. Many are projecting BTC to reach into the million-dollar mark for a single BTC, which at that point even the wealthiest 10% in the world can’t even afford.
We have reached the point that the tulip market reached in November of 1636, futures are starting to be offered on BTC and guess what followed 3 months later? The most abrupt “bubble” popping and a complete market crash. Community members had sold of their homes, livestock, and even the last few bucks they had to their name to acquire these tulips. As the market for BTC continues to grow, even the most basic individuals are putting their minimum wage checks into these exchanges and wallets in hopes of striking it rich, just as their predecessors have done in the past and are currently doing. Apparently, the world never learned from Tulip Mania or the great depression, where people lost everything because they were putting their money in places without any security and ultimately lost every bit of their monetary lives. Maybe it could be put into a simpler comparison of what bitcoin is.
If you have a smart phone, you most likely have downloaded games such as candy crush or clash of clans with those pesky in app purchases for their “currencies.” Probably wondering where I am going with this and you might already know what is being implied. All you have is some in-app currency that you get to play with daily and make a few bucks on, but, it’s just a game. Some guy that literally nobody knows, created some currency and got a lot of people to believe in it, but not really. People purchase these coins and then sell them to get their everyday fiat money in return. If you truly believe in these currencies, why are you not holding on to them and why can’t you spend them at your neighborhood market? All everyone is doing, is making this guy “Satoshi” extremely rich and whenever this guy decides that he’s had enough and the game is over; he just goes “click” and shuts everything done and has ultimately schemed everyone out of trillions of dollars and everyone is left looking at a computer screen with no money in their bank account and wondering what they are going to do going forward.
So, if you are going to get into the game, make sure you know what you are doing and have a plan to get out. You may think I am being a hypocrite because I myself have bought into this, but I have also received my initial investment back and just playing profits. I want everyone to have fun and make a little bit of extra money, but if you believe that this will ultimately take over currencies around the world, you have another thing coming. Until “Satoshi” comes forward, there is public backing of these coins, and the market accepts it everywhere; be careful and invest wisely. Until then, you are playing the ultimate game of monopoly and “Satoshi” owns all 32 homes on the board. Good Luck!
submitted by Mblosser1289 to Bitcoin [link] [comments]

Comments on Digital Currencies by Oaktree Capital's Howard Marks

Hi, I was just reading this article when I stumbled upon a reference to Digital Currencies and especially Ethereum. The author seems to have strong doubts about digital currencies in general.
I am interested in Ethereum and have been reading up on it, but I haven't made up my mind on it yet. To be clear, I do not share the views of the author of this article. I think Digital Currencies have great potential and have a place in the future economy.
Help me understand it better. How would you respond of this article? What would you say regarding the article's doubts?
Thanks!
Digital Currencies The discussion of innovative investments brings me to Bitcoin, Ether and other digital currencies. I’d guess these things have arisen from the intersection of (a) doubts about financial security – including the value of national currencies – that grew out of the financial crisis and (b) the comfort felt by millennials regarding all things virtual. But they’re not real.
Some businesses accept Bitcoin as payment. Some buyers want to own Ether because it can be used to pay for computing power on the Ethereum network. Some people are eager to speculate on digital currency for profit. Others want to put a little money into these to-date-profitable phenomena rather than run the risk of missing out. But they’re not real!
People tell me these currencies are solid, because (a) they’re secure against hacking and counterfeiting and (b) the software used to generate them strictly limits the amount that can be created. But they’re not real!!!!! Nobody has been able to make sense to me of these currencies. Here are a few paragraphs on Ether from The New York Times of June 19:
The sudden rise of Ethereum highlights how volatile the bewildering world of virtual currency remains, where lines of code can be spun into billions of dollars in a matter of months. . . .
Ethereum was launched in the middle of 2015 by a 21-year-old college dropout, Vitalik Buterin . . . Mr. Buterin was inspired by Bitcoin, and the software he built shares some of the same basic qualities. Both are hosted and maintained by the computers of volunteers around the world, who are rewarded for their participation with new digital tokens that are released into the network every day.
Because the virtual currencies are tracked and maintained by a network of computers, no government or company is in charge. The prices of both Bitcoin and Ether are established on private exchanges, where people can sell the tokens they own at the going market price. . . .
Many [new currency] applications being built on Ethereum are also raising money using the Ether currency, in what are known as initial coin offerings, a play on initial public offerings.
Start-ups that have followed this path have generally collected Ether from investors and exchanged them for units of their own specialized virtual currency, leaving the entrepreneurs with the Ether to convert into dollars and spend on operational expenses.
These coin offerings, which have proliferated in recent months, have created a surge of demand for the Ether currency. Just last week, investors sent $150 million worth of Ether to a start-up, Bancor, that wants to make it easier to launch virtual currencies.
Bottom line: you can use the imaginary currency Ether to buy other new imaginary currencies, or to invest in new companies that will create other new currencies. In “bubble.com,” I highlighted some illogical aspects of e-commerce by including some of my father’s old jokes regarding how to make money. Here’s another that seems 100% appropriate for the digital currency movement:
Two guys meet in the street. Joe tells Bob about the hamster he has for sale: pedigreed and highly intelligent. Bob says he’d like to buy a hamster for his kid: “How much is it?” Joe answers, “half a million,” and Bob tells him he’s crazy.
They meet again the next day. “How’d you do with that hamster?” Bob asks. “Sold it,” says Joe. “Did you get $500,000?” Bob asks. “Sure,” says Joe. “Cash?” “No,” Joe answers, “I took two $250,000 canaries.”
One of my very favorite quotes concerning the market’s foibles, from John Kenneth Galbraith, says that in euphoric times, “past experience, to the extent that it is part of memory at all, is dismissed as the primitive refuge of those who do not have the insight to appreciate the incredible wonders of the present.”
Maybe I’m just a dinosaur, too technologically backward to appreciate the greatness of digital currency. But it is my firm view that the ability of these things to gain acceptance is just one more proof of the prevalence today of financial naiveté, willing risk-taking and wishful thinking.
In my view, digital currencies are nothing but an unfounded fad (or perhaps even a pyramid scheme), based on a willingness to ascribe value to something that has little or none beyond what people will pay for it. But this isn’t the first time. The same description can be applied to the Tulip mania that peaked in 1637, the South Sea Bubble (1720) and the Internet Bubble (1999-2000).
Serious investing consists of buying things because the price is attractive relative to intrinsic value. Speculation, on the other hand, occurs when people buy something without any consideration of its underlying value or the appropriateness of its price, solely because they think others will pay more for it in the future.
It isn’t unreasonable for someone to use Bitcoin to pay for something – or for a seller to accept Bitcoin in payment – based on an agreement between the parties: barter takes place all the time. But does that make it “currency”?
The price of Bitcoin has more than doubled since the start of the year. Can something that does that seriously be considered a “medium of exchange” or “store of value,” rather than the subject of a speculative mania? Maybe not, but Bitcoin looks staid in comparison to Ether, which has appreciated 4,500% so far this year. The outstanding Ether is now worth 82% as much as all the Bitcoin in the world, up from 5% at the beginning of the year.
The New York Times notes that together, the outstanding Bitcoin and Ether are worth more than Paypal and almost as much as Goldman Sachs. Would you rather own all of the two digital currencies or one of those companies? In other words, are these currencies’ values real? They’re likely to keep working as long as optimism is present, but their performance in bad times is far from dependable. What will happen to Bitcoin’s price and liquidity in a crisis if people decide they’d rather hold dollars (or gold)?
Source: https://www.oaktreecapital.com/insights/howard-marks-memos
submitted by CaptainChopsticks to ethtrader [link] [comments]

Howard Marks (one of the great investors) calls Bitcoin a pyramid scheme

I come from an investing background, and have huge respect for Howard Marks. I usually agree with (or can at least appreciate) the views put forward in his memos. I am bullish on BTC and ETH long term and am a believer in the technology but would be keen to hear some rebuttals from y'all. Granted the 'Bitcoin is a ponzi' criticism generally comes from those with a pretty rudimentary understanding of the technology and its principles.
https://www.oaktreecapital.com/insights/howard-marks-memos
Relevant segment:
"Digital Currencies
The discussion of innovative investments brings me to Bitcoin, Ether and other digital currencies. I’d guess these things have arisen from the intersection of (a) doubts about financial security – including the value of national currencies – that grew out of the financial crisis and (b) the comfort felt by millennials regarding all things virtual. But they’re not real.
Some businesses accept Bitcoin as payment. Some buyers want to own Ether because it can be used to pay for computing power on the Ethereum network. Some people are eager to speculate on digital currency for profit. Others want to put a little money into these to-date-profitable phenomena rather than run the risk of missing out. But they’re not real!
People tell me these currencies are solid, because (a) they’re secure against hacking and counterfeiting and (b) the software used to generate them strictly limits the amount that can be created. But they’re not real!!!!! Nobody has been able to make sense to me of these currencies. Here are a few paragraphs on Ether from The New York Times of June 19:
The sudden rise of Ethereum highlights how volatile the bewildering world of virtual currency remains, where lines of code can be spun into billions of dollars in a matter of months. . . .
Ethereum was launched in the middle of 2015 by a 21-year-old college dropout, Vitalik Buterin . . . Mr. Buterin was inspired by Bitcoin, and the software he built shares some of the same basic qualities. Both are hosted and maintained by the computers of volunteers around the world, who are rewarded for their participation with new digital tokens that are released into the network every day.
Because the virtual currencies are tracked and maintained by a network of computers, no government or company is in charge. The prices of both Bitcoin and Ether are established on private exchanges, where people can sell the tokens they own at the going market price. . . .
Many [new currency] applications being built on Ethereum are also raising money using the Ether currency, in what are known as initial coin offerings, a play on initial public offerings.
Start-ups that have followed this path have generally collected Ether from investors and exchanged them for units of their own specialized virtual currency, leaving the entrepreneurs with the Ether to convert into dollars and spend on operational expenses.
These coin offerings, which have proliferated in recent months, have created a surge of demand for the Ether currency. Just last week, investors sent $150 million worth of Ether to a start-up, Bancor, that wants to make it easier to launch virtual currencies.
Bottom line: you can use the imaginary currency Ether to buy other new imaginary currencies, or to invest in new companies that will create other new currencies. In “bubble.com,” I highlighted some illogical aspects of e-commerce by including some of my father’s old jokes regarding how to make money. Here’s another that seems 100% appropriate for the digital currency movement:
Two guys meet in the street. Joe tells Bob about the hamster he has for sale: pedigreed and highly intelligent. Bob says he’d like to buy a hamster for his kid: “How much is it?” Joe answers, “half a million,” and Bob tells him he’s crazy.
They meet again the next day. “How’d you do with that hamster?” Bob asks. “Sold it,” says Joe. “Did you get $500,000?” Bob asks. “Sure,” says Joe. “Cash?” “No,” Joe answers, “I took two $250,000 canaries.”
One of my very favorite quotes concerning the market’s foibles, from John Kenneth Galbraith, says that in euphoric times, “past experience, to the extent that it is part of memory at all, is dismissed as the primitive refuge of those who do not have the insight to appreciate the incredible wonders of the present.”
Maybe I’m just a dinosaur, too technologically backward to appreciate the greatness of digital currency. But it is my firm view that the ability of these things to gain acceptance is just one more proof of the prevalence today of financial naiveté, willing risk-taking and wishful thinking.
In my view, digital currencies are nothing but an unfounded fad (or perhaps even a pyramid scheme), based on a willingness to ascribe value to something that has little or none beyond what people will pay for it. But this isn’t the first time. The same description can be applied to the Tulip mania that peaked in 1637, the South Sea Bubble (1720) and the Internet Bubble (1999-2000).
Serious investing consists of buying things because the price is attractive relative to intrinsic value. Speculation, on the other hand, occurs when people buy something without any consideration of its underlying value or the appropriateness of its price, solely because they think others will pay more for it in the future.
It isn’t unreasonable for someone to use Bitcoin to pay for something – or for a seller to accept Bitcoin in payment – based on an agreement between the parties: barter takes place all the time. But does that make it “currency”?
The price of Bitcoin has more than doubled since the start of the year. Can something that does that seriously be considered a “medium of exchange” or “store of value,” rather than the subject of a speculative mania? Maybe not, but Bitcoin looks staid in comparison to Ether, which has appreciated 4,500% so far this year. The outstanding Ether is now worth 82% as much as all the Bitcoin in the world, up from 5% at the beginning of the year.
The New York Times notes that together, the outstanding Bitcoin and Ether are worth more than Paypal and almost as much as Goldman Sachs. Would you rather own all of the two digital currencies or one of those companies? In other words, are these currencies’ values real? They’re likely to keep working as long as optimism is present, but their performance in bad times is far from dependable. What will happen to Bitcoin’s price and liquidity in a crisis if people decide they’d rather hold dollars (or gold)?"
submitted by Degracchi to Bitcoin [link] [comments]

Bitcoin and Other Monkey Bubbles: How Do They Work?

A friend of mine from MIT posted this and I’d like to see your thoughts on that. “Please permit me to explain so you can potentially avoid future financial pain.
Classic market theory considers information asymmetries. Bitcoin economics revolve around misperception of information symmetries. Everyone thinks everyone knows Supply and Demand.
The supply of Bitcoin is about 16 million. There will never be more than 21 million Bitcoin and that doesn’t come until more than 110 years from now.
If Janet Yellin were in charge of Bitcoin supply, it would be fully allocated within ten years.
If Donald Trump and Republicans could find a way for fat cat puppet masters like Robert Mercer or Sheldon Adelson to take a cut...ten months.
If Robert Mugabe...ten weeks.
So the predictable and slooooow increase is the key to creating the perception of relative scarcity.
The key to the hyperbolic rise of Bitcoin is a completely computable and predictable mismatch between supply and demand. There are only ten Bitcoin mined every 10 to 20 minutes by solving exponentially harder math problems that get harder based on the number of people throwing hardware at the problem. Supply is purposefully constrained and does NOT follow classic supply demand curves.
Demand is driven by the desire to own one Bitcoin. There are more than 16 million people who want to own one or more Bitcoin (250 million people own gold) and they all know this.
If this is too complicated, let’s consider how to artificially create scarcity.
Once upon a time in a village a man appeared who announced to the villagers that he would buy monkeys for $10. The villagers knew that the jungle held countless monkeys, easily caught. The man bought 2 thousand.
As the supply diminished, they become difficult to catch, and villagers returned to their farms. The man announced that he would pay $20. The villagers renewed their efforts and caught 1,000 more monkeys.
The supply quickly diminished, but before they returned to their farms the man increased his offer to $40 each. Monkeys became so rare that it was difficult to even see a monkey let alone catch it. But they caught 500.
The man now announced that he would buy monkeys at $100! However, since he had to go to the city on some business his assistant would now buy for the man. The man departed.
Then the assistant told the villagers, “Look at all these monkeys the man has in that big cage. I will sell them to you at $50 each. When the man comes back you can sell the monkey’s back to him for $100.” The villagers queued up with all their saving to buy the monkeys. The assistant took their money. They never saw either the man or his assistant again.
They now owned 3,500 monkeys. They were paid $60,000 to catch them, and bought them back for $175,000.
Similar stories took place in real world: The Dutch Tulip Mania (aka “Tulipomania”) of 1634-1637 The South Sea Bubble (1716-1720) The Mississippi Bubble (1716-1720) The British "Railway Mania" Bubble The Florida Real Estate Bubble of the 1920s The Stock Market Crash of 1929 Kuwait’s Souk al-Manakh Stock Bubble & Crash Black Monday – the Stock Market Crash of 1987 Japan’s Bubble Economy of the 1980s The Dot-com Bubble (Late 1990s) The US Housing Bubble - 2008-??? and Bitcoin - 2017-???”
submitted by marconipp to Bitcoin [link] [comments]

[uncensored-r/Bitcoin] Bitcoin rise and fall - be careful!

The following post by Mblosser1289 is being replicated because the post has been silently removed.
The original post can be found(in censored form) at this link:
np.reddit.com/ Bitcoin/comments/7jjzlw
The original post's content was as follows:
I decided to write this a few days ago concerning BTC and other cryptocurrencies, enjoy the read and if you have questions about it, feel free to ask: Also like and share this article if you enjoy the read!
Between the years of 1634 and 1637 there was a similar phenomenon to our modern-day Bitcoin (BTC) that we are currently experiencing. It was known as Tulip Mania where the Dutch blew up the price of this flower because of the rarity of it and the increased demand. In one month, the prices inflated just over 2,000% and people were given anything and everything they owned to get a piece of the action. Again, we are seeing something similar with the emergence of cryptocurrencies, but what protected the Dutch and what is protecting us today with these prices? The answer: nothing at all.
Sure, even I have jumped on the bandwagon of buying and selling these currencies and have enjoyed every minute of it, but just as Tulip Mania, we are eventually going to face this infamous “bubble” that major economists are rambling on about. Tulips at their initial release to the Dutch community became a luxury item, where bulbs were being sold at almost 10x what a normal laborer was making during that period. You are certainly seeing something similar with BTC and other coins and the growth that is happening daily. Many are projecting BTC to reach into the million-dollar mark for a single BTC, which at that point even the wealthiest 10% in the world can’t even afford.
We have reached the point that the tulip market reached in November of 1636, futures are starting to be offered on BTC and guess what followed 3 months later? The most abrupt “bubble” popping and a complete market crash. Community members had sold of their homes, livestock, and even the last few bucks they had to their name to acquire these tulips. As the market for BTC continues to grow, even the most basic individuals are putting their minimum wage checks into these exchanges and wallets in hopes of striking it rich, just as their predecessors have done in the past and are currently doing. Apparently, the world never learned from Tulip Mania or the great depression, where people lost everything because they were putting their money in places without any security and ultimately lost every bit of their monetary lives. Maybe it could be put into a simpler comparison of what bitcoin is.
If you have a smart phone, you most likely have downloaded games such as candy crush or clash of clans with those pesky in app purchases for their “currencies.” Probably wondering where I am going with this and you might already know what is being implied. All you have is some in-app currency that you get to play with daily and make a few bucks on, but, it’s just a game. Some guy that literally nobody knows, created some currency and got a lot of people to believe in it, but not really. People purchase these coins and then sell them to get their everyday fiat money in return. If you truly believe in these currencies, why are you not holding on to them and why can’t you spend them at your neighborhood market? All everyone is doing, is making this guy “Satoshi” extremely rich and whenever this guy decides that he’s had enough and the game is over; he just goes “click” and shuts everything done and has ultimately schemed everyone out of trillions of dollars and everyone is left looking at a computer screen with no money in their bank account and wondering what they are going to do going forward.
So, if you are going to get into the game, make sure you know what you are doing and have a plan to get out. You may think I am being a hypocrite because I myself have bought into this, but I have also received my initial investment back and just playing profits. I want everyone to have fun and make a little bit of extra money, but if you believe that this will ultimately take over currencies around the world, you have another thing coming. Until “Satoshi” comes forward, there is public backing of these coins, and the market accepts it everywhere; be careful and invest wisely. Until then, you are playing the ultimate game of monopoly and “Satoshi” owns all 32 homes on the board. Good Luck!
submitted by censorship_notifier to noncensored_bitcoin [link] [comments]

12-13 16:01 - 'Bitcoin rise and fall - be careful!' (self.Bitcoin) by /u/Mblosser1289 removed from /r/Bitcoin within 19-29min

'''
I decided to write this a few days ago concerning BTC and other cryptocurrencies, enjoy the read and if you have questions about it, feel free to ask: Also like and share this article if you enjoy the read!
Between the years of 1634 and 1637 there was a similar phenomenon to our modern-day Bitcoin (BTC) that we are currently experiencing. It was known as Tulip Mania where the Dutch blew up the price of this flower because of the rarity of it and the increased demand. In one month, the prices inflated just over 2,000% and people were given anything and everything they owned to get a piece of the action. Again, we are seeing something similar with the emergence of cryptocurrencies, but what protected the Dutch and what is protecting us today with these prices? The answer: nothing at all.
Sure, even I have jumped on the bandwagon of buying and selling these currencies and have enjoyed every minute of it, but just as Tulip Mania, we are eventually going to face this infamous “bubble” that major economists are rambling on about. Tulips at their initial release to the Dutch community became a luxury item, where bulbs were being sold at almost 10x what a normal laborer was making during that period. You are certainly seeing something similar with BTC and other coins and the growth that is happening daily. Many are projecting BTC to reach into the million-dollar mark for a single BTC, which at that point even the wealthiest 10% in the world can’t even afford.
We have reached the point that the tulip market reached in November of 1636, futures are starting to be offered on BTC and guess what followed 3 months later? The most abrupt “bubble” popping and a complete market crash. Community members had sold of their homes, livestock, and even the last few bucks they had to their name to acquire these tulips. As the market for BTC continues to grow, even the most basic individuals are putting their minimum wage checks into these exchanges and wallets in hopes of striking it rich, just as their predecessors have done in the past and are currently doing. Apparently, the world never learned from Tulip Mania or the great depression, where people lost everything because they were putting their money in places without any security and ultimately lost every bit of their monetary lives. Maybe it could be put into a simpler comparison of what bitcoin is.
If you have a smart phone, you most likely have downloaded games such as candy crush or clash of clans with those pesky in app purchases for their “currencies.” Probably wondering where I am going with this and you might already know what is being implied. All you have is some in-app currency that you get to play with daily and make a few bucks on, but, it’s just a game. Some guy that literally nobody knows, created some currency and got a lot of people to believe in it, but not really. People purchase these coins and then sell them to get their everyday fiat money in return. If you truly believe in these currencies, why are you not holding on to them and why can’t you spend them at your neighborhood market? All everyone is doing, is making this guy “Satoshi” extremely rich and whenever this guy decides that he’s had enough and the game is over; he just goes “click” and shuts everything done and has ultimately schemed everyone out of trillions of dollars and everyone is left looking at a computer screen with no money in their bank account and wondering what they are going to do going forward.
So, if you are going to get into the game, make sure you know what you are doing and have a plan to get out. You may think I am being a hypocrite because I myself have bought into this, but I have also received my initial investment back and just playing profits. I want everyone to have fun and make a little bit of extra money, but if you believe that this will ultimately take over currencies around the world, you have another thing coming. Until “Satoshi” comes forward, there is public backing of these coins, and the market accepts it everywhere; be careful and invest wisely. Until then, you are playing the ultimate game of monopoly and “Satoshi” owns all 32 homes on the board. Good Luck!
'''
Bitcoin rise and fall - be careful!
Go1dfish undelete link
unreddit undelete link
Author: Mblosser1289
submitted by removalbot to removalbot [link] [comments]

Is Bitcoin a Ponzi Scheme or a Pyramid Scheme? - YouTube The goldilocks price of oil  Counting the Cost Dutch Market Crash: Tulip Mania 1636-1637 Explained From Bit coin Digital money to Tulip digital money venture investment madness Tulip mania Tulip Mania: The First Economic Bubble  1MinuteDoc

Tulip Mania and Bitcoin . One of the most similar markets in today’s world is the Bitcoin and cryptocurrency market. Because the value of the Bitcoin has gone up by more than anybody in the market could’ve expected it to. And for people who bought Bitcoin before 2017, the return on investments are incredibly high. “The Bitcoin bubble is like Tulip mania which will crash sooner or later, as most people investing are basically speculating and do not know the nuances of the cryptocurrency,” he said. Two Important Similarities between Bitcoin and Tulip Mania. Price History: No matter how the price of the two most volatile markets in History is looked at ... And that’s how the bubble popped, effectively making Tulip Mania the world’s first economic bubble. Why bitcoin is nothing like tulips. If we’re looking through the lens of past years, it’s understandable to compare the Dutch Tulip Mania with the rising prices of bitcoin. They were both highly valued assets and used as investment tools ... The parallels between tulip mania and Bitcoin are strikingly similar. It was the debut of new futures contracts that brought Bitcoin mania to full throttle. Following their release, the cryptocurrency collapsed to a shocking low the following February – some 380 years later. Now a widespread virus outbreak now is causing economic distress. Players in the financial and technology sector have different opinions about bitcoin. For skeptics, the cryptocurrency is reminiscent of Holland’s notorious Tulip bubble of 1637. They generated a wild, speculative mania and disappeared, leaving behind pretty flowers and wrecked investors.

[index] [17122] [21399] [18171] [1115] [15606] [25365] [27166] [28489] [25560] [33832]

Is Bitcoin a Ponzi Scheme or a Pyramid Scheme? - YouTube

When a tulip bulb cost as much as a house: The Tulip Mania of 1637 - Duration: 12:25. The History Guy: History Deserves to Be Remembered Recommended for you This video covers the accusation that Bitcoin is nothing more than a speculative bubble, and its comparison to things like "Tulip Mania." Sentdex.com At the peak of tulip mania, in March 1637, some single tulip bulbs sold for more than 10 times the annual income of a skilled craftsman. ... featured mania-like similarities to a bubble.The term ... A house cost the same as one single exotic Tulip bulb. Many analysts consider Tulip mania as the first ever economic bubble. Like all bubbles it was set to burst. Financial bubbles and bitcoin ... We look at the psychology behind things like tulip mania, and ask if the current bitcoin craze is indeed a bubble waiting to burst.

#