Some people are leery about what is rightly styled “crypto” – because of the opacity of whatever-it-is. Dollars and cents make sense, at least – in that everyone not actually special can understand that a dollar is a piece of paper issued by the Federal Reserve. Who issues crypto? Who controls it? An Internet phantom with a Japanese name?
We at least know the source of our dollars. And we have them in our possession. Crypto is possessed in a rhetorical sense only because it is non-physical. Your device shows digits, like the ones that manifest when I type these letters on a keyboard. But the numbers exist as images only – and exist only as long as they are displayed by the device; e.g., the computer or phone that you’re looking at. If the computer or phone goes dark, the numbers disappear.
So does your “crypto.”
It is a means of exchange entirely dependent upon virtual reality – which of course is actually not reality. Just as “flying” a flight simulator is not actually flying. And even within the virtual reality of the simulator, you are not actually flying – because it is the computer that has control over everything. You are not in control of the yoke or the rudders. You have the illusion of control – which lasts for exactly as long as those who control the illusion wish to allow it.
Crypto is of a piece, is it not? How do you control what is on a screen controlled by some other party? If that screen goes dark, what will you do? Who will you call about it? What control over them have you got?
At least with a dollar in your pocket you can buy something from whoever is willing to sell it. There is no unseen hand in between the two of you. An unseen hand that can slap down the hand of either buyer or seller if it does not wish the transaction to take place. The holder of crypto being in the same basic position as the person who is not really free to speak on social media, another iteration of virtual control over our reality. Everyone intuits that they are “free” to speak to precisely the extent it is allowed and no one knows exactly what is allowed and that is exactly how the control over speech is asserted. The knowing you don’t know – and that you do not have any control over it.
Everyone knows that the value – that is, the buying power – of a dollar wanes over time. This is styled “inflation,” which is something of a misnomer in that while it is true the infusion of more dollars is the cause of the devaluation, it ends up meaning you need more more dollars to buy the same stuff.
But at least this devaluation is relatively consistent and so predictable. Put another way, it is not usually the case that what a dollar bought today loses 10 percent of its value by the next day.
Crypto works like that.
I have a small Bitcoin balance – and it varies within 24 hours from around $510 to as little as $460. That’s an unsettling amount of volatility. Of course, that is also part of the lure. These wide swings in the value of crypto are tantalizing to speculators, which is the same as saying gamblers – and there’s nothing per se wrong with gambling, assuming you are gambling with your own money. But with crypto, the gambling is with everyone’s crypto as the value of your holdings is very much tied to the gambling of others with theirs.
There are get-rich-opportunities for sure. But for every one who gets rich quick there are many who end up broke, quick. It’s perhaps fun when the stakes are small. I can afford to lose my Bitcoin holdings because plus or minus $500 is not a life-changing amount of “coin.” If I wake up 24 hours from now and discover the value of my “assets” – as they are styled – have dwindled to $20 it will be like a weekend spent at Vegas playing the slots. You win some and you lose some – but you haven’t (hopefully) lost your shirt.
This isn’t to say crypto is evil. It is to say, be careful.
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I’ve avoided Bitcoin for one, simple reason: I don’t understand it. One of Warren Buffet’s cardinal rules of investing is to never invest in something you don’t understand. Since I don’t understand BTC, I don’t invest in it.
Once upon a time – 2010-2011 — I bought a significant amount of *physical* silver and gold. At the time all the “gurus” were shouting in unison that both metals’ values were going “To da *MOOON! Any DAY now!!”
By 2016 gold had lost ~50% of its 2010-2011 buying power, and silver had lost about 75%. The buying power of the dollar — FRNs — did not decline by 75% or even 50% during that same time period.
Dave’s not here. har
Silver in 1980 was 8.00 dollars per ounce, four dollars for a half dollar, Franklins are now worth a lot more. Silver was even at six dollars in 1990, a bargain. Could not go wrong at six dollars for a one ounce new Walking Liberty back then.
I remember thinking about buying a double-eagle from the 1920’s for 289 dollars back in 1999. Not a gold bug, junk gold is okay, jewelers won’t buy gold, just will do a trade. No cash for you!
Pennies are a better choice for coin collectors, numismatic pennies do exist. A lot more pennies out there than gold double-eagles.
Trouble with metals is that they’re useless as a means of currency/exchange in today’s world. Try taking your Maple Leaf down to the store, or asking the guy selling a car on CL if he’ll take gold. LOL.
I bought some gold a while back when it took a dip. After sales tax and the commission the seller takes, that “$1750” gold had to become worth $1950 just for me to break even. I held it till it got up to about $2260, which took two fricking years. When it was time to sell it, there was nothing to do with it except sell it back to the place I bought it from. The local shop wouldn’t pay as much, and despite it always telling me that they pay cash, when I went to cash in my $10K worth of gold, all I got was “We only give checks for large amounts” (and wanted it for $50 under spot).
So I sold it back to the place I got it from, which involved packing and shipping and insuring, and had to end up with a check. In the end, my $10K investment netted me a little under $1500 in c. 2 years. Not that I had bought it with intentions of making money; I just wanted to use it as a hedge and to preserve some “wealth”, but decided to bail when I was at least in profit country, because as I had been seeing, even in normal times, metal is not very liquid
Any ideas of using metals as currency when TSHTF is an utter fantasy. It may not be a bad way to preserve wealth, long term (depending on when you buy it. – Hint: NOT now!) and to facilitate moving wealth out of the country, but other than that, leave it to the hobbyists and collectors.
I consider the new tools I bought with the $1500 profit a much better investment than the gold.
The problem is that we will all be “bitcoin maxers” whether we want to be or not. Blackrock’s ETF, and numerous states have already introduced legislation to form bitcoin reserves. Pension funds are also getting in on the action. Taxpayers become the bagholders for the crypto whales.
What is it like when an entire country is rug-pulled?
1789
Ludwig von Mises argues that ‘sound money’ is an instrument for the protection of civil liberties and a means of limiting government power.
This my friends is why the owners of the privately owned central banks have nefariously given us fiat (Fake) currencies and instituted a massive debt scheme on humanity.
“Give me control over a nation’s currency, and I care not who makes its laws.”
-Mayer Anschel Rothschild
Rothschild is a German-Jewish banking family and the founders of the Rothschild banking dynasty that own and control most of the worlds wealth today. It is thought that the Rothschild’s hold over 90% of the worlds processed Gold in vast underground cellars.
Let that sink in for a moment..
Proton is priced at 0.005 dollars. Times 200 equals one dollar.
It’s up 80 percent today.
20,000,000 Protons equals one BitCoin!
Proton is a better buy.
Hi Drump,
There’s also something called – wait for it – Elonia. Maybe I need to coin my own crypto and thus be able to afford a new computer. Let’s see . . . How about Ericium?
How about PonziCoin?
It’s what all crypto truly is…an immaculate scam by the original scammers…(((government))).
Although bitcoin is a creation of the CIA, and is meant to be completely trackable, unlike precious metals or paper currency. It’s a feature, not a bug…
There are many differing opinions on precious metals vs FRN and Bitcoin. The main difference as I see it is that value is whether the value is inherent to the item in question.
A gold or silver coin minted or issued by the USSR, the Third Reich or Spanish Empire still has value even though the underlying institutions are long gone. Paper money issued by the same institutions may have value as a novelty but no other.
Federal Reserve Notes in the event of the collapse of the Union will be worth even less than Confederate money due to there being more of them.
Bitcoin may have some value but I’m darned if I can understand it’s valuation even though there might be more to it value than Doge Coin.
Bitcoin is here to stay, the rest are sh*tcoins, even Ethereum. It makes sense to have some in your investment portfolio, if you’ve got one, because it could still shoot the moon if it becomes monetized.
I understand the code and crypto behind Bitcoin quite well. As long as you have a hard copy of your wallet private key (or seed, or some other analogue), you have control over the wallet. Yes, it may be totally inconvenient if access to the blockchain is blocked, but it’s quite resistant to censorship. If you can get a transaction message out to someone who has access to the blockchain, you are still in control of that balance, nobody else can possibly ever spend it or take it from you. The only thing which is a risk today are quantum computers, but a practical one is decades away, and lots of cryptographers are working on quantum resistant algorithms, so hopefully we will have something before quantum computation is an actual risk.
And what, exactly, is the solution to the FACT that crypto-currency relies completely on THEIR INFRASTRUCTURE?
Literally, all anyone has to do is type a single command into a DNS server and all crypto resolution requests will simply not work.
“Gee, I sure would like to pay for my groceries today with bitcoin.”
404 PAGE NOT FOUND.
Hmmm…..
Whose infrastructure?
The blockchain is a database. Anyone running the Bitcoin client has a copy of that database; every transaction ever. Every miner can be a bitcoin server. All you need is to be able to contact _any_ member of the mining pool, anywhere in the world. It doesn’t even need DNS. Some miners can be contacted privately via Tor.
The whole point is no central owner, no central point of failure, and this holds true. Your access can be really difficult – in that you might have to smuggle a transaction on a piece of paper to someone who can execute it, if you government blocks you, but it really is unstoppable.
TOR?
TOR is RAN by the govt.
I think you may have made a mistake.
Tor has many nodes run by the government in an attempt to decloak the users, particularly exit and entrance nodes, but it doesn’t appear they have enough to decloak reliably. If you connect to a dark web service, that’s 6 hops of anonymous encryption involved, and every single one of those hops would have to be through a government compromised node. Yeah, it’s not 100% that you can avoid being decloaked, but your odds are good.
Still, there are other ways to sneak transactions through blockades. It’s just a small amount of data, about 350 bytes. It can easily be hidden inside any other kind of data. You can subtly distort an image, or you can bury it inside HTTP headers, or you can even change some spacing or layout in a document to transport data (this is called steganography). I’ve built tools to break through censorship.. There are so many ways to do this, that avoiding a few commonly monitored ones isn’t a problem.
Your recitation of solid facts is appreciated. Not that doubters need to be convinced. If they want to be stuck with depreciating paper money, that’s on them.
That’s a bit of a straw man.
That’s not what we “want to be stuck with” at all.
It’s just that, there is more than “Choice A” and “Choice B”. In fact, any time someone tells me there are only 2 choices, I know for a fact there are more than 2 choices, and the person telling me there are only 2 choices happens to be part of the system that controls both choices.
The third choice is gold, which hit a record high today. Take your pick … and choose wisely!
Part of the system? Why, yes: I CONTROL THE HORIZONTAL AND THE VERTICAL. DO NOT ADJUST YOUR SET.
“The third choice is gold, which hit a record high today.”
Well, you’re only PARTLY correct.
It would be completely possible (and quite feasible) to have a 2-tiered money system, with silver-backed money for the “common man” and gold-backed money for “big business transactions”.
That ensures plenty of gold-based market leverage and an inexpensive metal-backed money supply for the average joe.
This, and making charging interest a crime, and you have a new economic system based on sound affordable money.
Interest which a borrower and a lender voluntarily agree upon, absent coercion or fraud, is not usury, Such interest simply reflects the costs and risks of one party renting another party’s money for a period of time and thus facilitates economic activity, To invoke the government to criminalize interest is patently anti-libertarian. That said, I agree that the kind of interest which undergirds our fiat debt-based, government-enforced monetary system, run by our good ((friends)) historically headquartered in the City of London, is indeed usurious.
Interest by its nature creates a greater possibility that the debtor won’t be able to pay back the loan. To say it “reduces risk” is a self-fulfilling prophecy.
All interest is usury.
“nobody else can possibly ever spend it or take it from you”
“In November 2020, the U.S. Department of Justice seized nearly 70,000 bitcoins linked to the Silk Road website, which was an online black market. This was the largest cryptocurrency seizure by the U.S. government to date.”
True, Philo, Ross may want his coins back.
The day government seized them they were worth $1.4 BILLION Dollars.
As of today, they are worth almost $7.1 BILLION Dollars.
I wonder whose wallet they have been assigned to?
The Federal government is holding those seized bitcoins in impound, and they will be sold off at some point, just like an impounded car or boat is auctioned off.
https://fortune.com/crypto/2025/01/09/federal-government-allowed-sell-bitcoin-silk-road-courts/
Sure, if you’re compelled to divulge your private key, anything goes. Ross’ bitcoin wasn’t hacked or somehow taken by breaking the system, the government got their hands on the secret keys.
The cryptography powering signatures and hashes in Bitcoin has stood the test of time. It’s old.
I hold two board and leadership roles in professional advisory organizations. We had last week the largest digital asset managers, with series of industry firsts in Bitcoin and Etherium investing products, present to us. I organized the presentation and got along very well with them. Before the talk I read the book Hijacking Bitcoin to know more about the subject and also reviewed all of the videos to prepare for the talk.
I spoke later in the day to highly credentialed executive at a major trust company and he said “I wished that I could have made it to the talk. I know a lot of people who made a lot of money on Bitcoin, but I don’t know what it is.” I told him that I don’t know what it is.
He told me that the same company sent nine of their reps to his company’s office in Chicago and spent hours there with clients and their most respected analyst, who confessed that she doesn’t know what it is. Why do we put a value to the electricity expensed and solving a math problem? I’ll plant some tulips instead.
I suggest taking a hard look at the symbolism in the Etherium logo. It’s as hard-core Jewish “As above, so below” as anything I’ve ever seen.
Why do we put value in fiat pieces of paper with dead presidents printed on them that are constantly being devalued?
How is that any more logical?
Pointing out the lack of logic in one system does not prove the logic of another.
“Literally, all anyone has to do is type a single command into a DNS server and all crypto resolution requests will simply not work.”
Your fundamental lack of understanding the internet architecture, Bitcoin, and obsession with the Jews done it mantra is hardly the gold standard of logic.
Please feel free to layout your master plan to free the world of its enslavement to the Jews as you perceive it. While you’re at it, please elaborate on your plan to bring back sound monetary policy.
I’ll answer the “plan to bring back sound monetary policy”, because my answer to what to do to free the world from the Jews is well known.
I’m sure you’re well familiar with Noel Ignatiev. Flip his plan to exterminate the white race and turn it on them, and there you have it. Simple. Who could ever find fault for using the Jew’s own plan against them? Surely that must be moral. But back to the monetary policy.
1. End the federal reserve bank in totality.
2. Establish 2 forms of currency: 1: Silver-backed currency (for the common people) in the form of “silver certificates”. Nothing new or outlandish here, just something that has already been done before. This would be the “common money” in circulation for use by the people. 2: Gold-backed currency (for business and government transactions). The higher value of gold makes it useful for the “very large”, and the cheaper silver-backed money makes it easily affordable for the common folk.
3. Outlaw the charging of interest. Interest is slavery. Interest is usury. By eliminating interest and making money the tool of the people rather than a set of shackles, a golden era of prosperity will emerge within 5 years. Just like it did for Germany, even after it was crippled by the Treaty of Versailles, 0 interest broke them free of the Jew-banker created global great depression.
4: Create law outlawing deficit spending.
I could implement this policy, if put in charge, in a matter of weeks. The principles behind these economic changes are irrefutable and backed by historical precedent. But, do please try to refute them.
“Outlaw the charging of interest. Interest is slavery. Interest is usury.”
Saving, which is the same as delaying consumption (in economics also known as ‘time preference’) is an essential part of being able to have a developed society. You need to save in order to create capital goods. Primitive societies don’t have capital goods. That’s why they’re primitive.
In order to save rather than immediately consume, apart from some intelligence, there needs to be an incentive. To make a boat so you can catch more fish, you need to first have saved enough food to allow you to take the time needed to accomplish the building.
Interest represents the time-value of money, or in other words, the ‘reward’ for saving. Present goods, something we have now, are more valuable than future goods – something we MAY have one day.
This is why, absent central bank meddling, the natural rate of interest is always positive; never zero or negative. If it were not, it would imply that future goods are equally, or even more valuable than present goods.
In summary, you have no idea – again – what you’re talking about.
LOL except under the current system, your “incentivized savings” gain value at around 2-3% while the money devalues at 5-8%. Or more in recent years. Which actually equates to a net loss.
In summary, you have no idea – again – what you’re talking about.
One fly in your ointment is silver, the assumptions you are making are outdated. It used to be that silver was valued at 20:1 vs gold. This was before the modern industrial age. Unfortunately, silver is consumed by industry, in film, in electrical contacts and conductors, etc. Silver is in fact rarer than gold, while the vast majority of gold ever mined is still in vaults and lockers, silver has mostly been consumed and is uneconomic to recover.
Silver is in fact ridiculously cheap and I’ve been tucking it away for decades.
“Film”?
We aren’t using silver nitrate film anymore, lmao.
Silver is also very chemically useful. I happen to be making some silver nitrate as I type this. Well, the solution is reducing for recrystallization, the making part is already done…
Regardless, it’s still more viable than gold for “cheap money”.
Argumentum ad ignorantiam is a time-honored tradition among many, when it comes to the topic of Bitcoin.
The same, long-disproved arguments are used over and over again. Tulips. Ponzi. CIA-controled. Etc etc.
To many, it’s just too hard to do some actual learning. You just can’t teach new tricks to old dogs I guess.
Regarding the book, Hijacking Bitcoin: The Hidden History of BTC, Catherine Austin Fitts interviews one of its authors here –
https://home.solari.com/hijacking-bitcoin-the-hidden-history-of-btc-with-steve-patterson/
Hijacking Bitcoin: The Hidden History of BTC with Steve Patterson
December 17, 2024
By Catherine Austin Fitts
(the Transcript is also available at the link)
Denizens beware: The internets are filled with digital solipsists.
The world is too.
The world’s greatest solipsist is indeed Donald Trump.
Everybody needs a serious break.
You can shoot the messenger some of the time, but you can’t shoot the messenger all of the time.
This is just a hunch from a very skeptic person, but I have a distinct feeling that the feds have a back door into “crypto” currencies. Otherwise they would outlaw it. They would TikTok it. They have their hooks in all things digital and the only way to kick them out of the loop is to go completely old school.
When tech companies spout off about being “secure” and not sharing your personal data, they are not including government entities.
When government “asks” for a company to hand over your data, it just wants to keep the appearance of not already having access to all of your data.
I second Philo’s hunch. I will go even further…I believe crypto was introduced by the US government.
Just so I’m clear about where I stand on Bitcoin; I don’t think this possibility can be ruled out.
Keep in mind that your dollars and bank accounts, and investment accounts exist purely at the will of Fed Gov too.
You are absolutely correct, BID.
It is why we should all be “Chock Full O’ Nuts metal cans filled with gold and silver coins in the backyard” kind of people.
Chock Full O’ Nuts can buried under the wax leaf privet.
Now, that is *my* idea of a “hedge fund.” 🙂
Plastic peanut butter jars actually work really well too. Just saying…
Hi Ernie,
Except, if I forget where I buried them. With the Chock Full O’ Nuts steel cans it sets off the metal detector. 🙂
Thirded! Not only that, but I scoff at it because it does not rectify any of the short-comings of FRNs: It is not any more stable than FRNs (In fact, it is less stable! It’s “value” can fluctuate 1000% over the course of a year or two. That makes the Argentinian peso look stable by comparison! And makes FRNs look rock solid ); It has no intrinsic value (At least with FRNs you have a piece of paper. With Bitcoin you have nothing tangible.); It is not private (It is less private than exchanging cash. There is an electronic record).
So what are the “advantages” of crypto? I don’t see any.
I believe it is just another ruse -like Facebook or the internet itself- to get people comfortable with what our malevolent tyrants will inflict upon us very soon. Just as the internet and smart phones have made people comfortable with total surveillance as just an accepted part of life, so too crypto is just prepping thye population for CBDCs.
I can see it now: “No, silly! It’s just like Bitcoin, only “safer”. What’s not to love?”.
“Not only that, but I scoff at it because it does not rectify any of the short-comings of FRNs”
I scoff at so many people that make comments that prove just how little effort they have put into trying to understand Bitcoin.
Bitcoin is not perfect but at least it has a finite limit of 21 million coins and cannot be inflated at will by a small cabal of elites.
If that doesn’t at least account for something vs FRN’s, I simply don’t have a response that would interest the FRN lovers.
Bitcoin:
Good idea cept for the computer part.
First off, I don’t love FRNs. I’m just using them for comparison to show that Bitcoin is even worse of a deal -When it’s whole premise is that it supposed to be a better deal.
Secondly, while there mau be a cap of 21 million (Which could change at any time. Who’s to say? Who could stop it?) it is quite obvious to even the casual observer (such as myself) that such a cap does absolutely NOTHING to prevent wild fluctuations of value. Haven’t we just within the last few years witnessed Bitcoin drop from somewhere around $60K to $7K and then back up to near $100K?
‘Nuff said.
Volatility has been decreasing, as is to be expected in line with increase in adoption:
https://bitbo.io/volatility/
If you want to learn exactly why, plus lots of other interesting things, go to Amazon and look for ‘The Bitcoin Standard’ by Saifedean Ammous.
That book can even be found, with a little bit of effort, in epub format for free.
I second this recommendation. Ammous’ treatment of Bitcoin and its advantages is easy to understand. He also wrote a second book called The Fiat Standard…there is alot of repetition between the two.
If you really want to know more about the advantages and disadvantages of Bitcoin specifically and crypto currencies generally, The Bitcoin Standard is a good place to start.
If you want to know about money from the Austrian School perspective, give Von Mises’ The Theory of Money and Credit a shot. Available free in epub, PDF and HTML at mises.org
Finally, I am at a loss to understand the emotional reaction I see to crypto currencies in the comments here. The nice thing about crypto is that participation is voluntary. CBDCs are another story entirely.
“I will go even further…I believe crypto was introduced by the US government.”
Agreed.
“The true identity of Satoshi Nakamoto remains one of the greatest mysteries in the cryptocurrency world.”
I call B.S… No one can remain anonymous in today’s world in such circumstances as this. It has CIA written all over it. Give me a break. I agree with Arthur, it’s a test run for CBDCs.
Ditto
First sentence of Satoshi Nakamoto’s 2009 paper, posted at bitcoin.org:
‘Commerce on the Internet has come to rely almost exclusively on financial institutions serving as trusted third parties to process electronic payments. While the system works well enough for most transactions, it still suffers from the inherent weaknesses of the trust based model.‘
People still speak glowingly of banks, because that’s what they are used to — even though the big banks had to be bailed out in 2008. Ask 1930s Americans what they thought about banks, after their deposits went poof. Or ask Vladimir Putin, after Treasury ‘secretary’ Yellen simply stole Russia’s USD forex reserves.
A trustworthy bankster is like a good-hearted prostitute: caution advised.
The mighty USA cannot seize Russia’s Bitcoin balances. It would need to conspire with more than half of Bitcoin holders to enter fraudulent transactions on the blockchain. But it can’t. Bitcoin’s design has been tested for 15 years in real time. So far, it is working.
Eric is right that crypto is volatile. It exhibits positive correlation with tech stocks, but at several times the level of volatility. And volatility is a two-way phenomenon: when tech stocks pop 2 percent, Bitcoin might well launch 8 percent.
Odd that the culprit in crypto’s pratfall over the weekend isn’t mentioned: the Orange Oracle of Oafishness, resplendent in his cardboard Burger King crown. MAGA PARTY, Y’ALL:
https://x.com/budlight/status/1885327698483966248
“We at least know the source of our dollars. And we have them in our possession.”
Do you have possession of your digital dollars? If you think so, you are sadly mistaken.
Your dollars on deposit with any bank simply make you a creditor of the bank. They have no obligation to return your dollars to you.
FAFO.
Ask the Canadian truckers where the Canadian dollars they possessed went.
Ask the account holders at MF Global where their dollars were disappeared by Jon Corzine; a United States Senator from 2001 to 2006, and the 54th governor of New Jersey from 2006 to 2010. Corzine still walks the earth as a free man.
Hi BID,
Well, yes – and no. I could in principle go the bank today and withdraw most or even all of the money – physically. I could walk out of the bank with the money in my hand. Crypto is always in a device – and can never be possessed in the way that cash can. Once the cash is in hand, it is entirely under my physical control and I can spend it anonymously, something that I do not believe is other than a delusion with regard to crypto.
With all due respect- try to go withdraw a significant amount of cash – let’s say $100k. You will quickly discover that special arrangements have to be made. Most likely your bank will balk at a sum as low as $10k – $20k and you will certainly be asked questions about your reasons for wanting that kind of cash.
Just because there are digital dollars in your account today is no guarantee they will be there tomorrow.
For the record: I don’t fully trust Bitcoin either.
Yes, BID –
But the point stands, doesn’t it? I could get physical cash. You cannot get physical crypto.
Banks must file an SAR (Suspicious Activity Report) for cash transactions over $5,000.
Thus, all large scale transactions are conducted via EFTs (Electronic Funds Transfers), which don’t automatically trigger an SAR.
That’s how the whales move their money. Paper dollars are for commerce at the minnow and plankton level.
You cannot get physical crypto.
Physical crypto is an oxymoron.
Point made in theory.
You want something physical in hand?
Then transact Bitcoin, get gold (or paper dollars, or toilet paper) in hand. What’s the difference at the end of day?
Yes, one additional transaction that isn’t free. But let’s not forget you also pay a transaction fee for anything other than walking up to a teller window and assuming they will give you your physical cash. Again to reiterate the bank has no obligation to give you what you believe is “your” cash.
Eric, back in the 1950s the communists, who had just seized power in Eastern Europe, first nationalized all private businesses, and then, to finish the job, decided to wipe out the ‘bourgeois cash hoarders’ by issuing a new currency.
Imagine that as of tomorrow, the dollar becomes ‘the New Dollar’ at a rate of 1:1 and you are allowed to convert a maximum of 1,000 USD to NUSD.
The rest of your cash is now toilet paper.
This is your ‘safe, physical cash’. There is nothing ‘safe’ about it, because you see, it’s not yours – it’s the government’s. They can print it to oblivion, just as they can strip its legal tender status and adopt any new form of money they declare to be the successor.
Can’t happen, right? Not in the ‘land of the free’!
Well, we used to think the same about a lot of other things…
Hi John,
Your point is valid, of course. It is among the many reasons why I prefer real money – gold and silver – which will always serve as money irrespective of government because people value silver and gold as such. And probably always will. I am hugely wary of crypto as money because it is entirely digital and ephemeral and I do not believe that anything digital is not within the government’s power to entirely control. I dread the prospect of only being allowed to buy and sell via an app on a device. A device that I have zero control over – including privacy control. Digital money would enable the government to know to the penny how we spend our money as well allow it to control – in real time – how we are allowed to spend our money. Rather than regard crypto as the way out of Fed Control, I would like to see a movement back toward sound physical money – silver and gold. Perhaps with silver-and-gold-backed certificates. But only if backed by silver and gold.
Back in 1972 I tried to withdraw $6,000 from my local small/medium sized bank. They could only give me a check for the 6 thou. Most of their money is lent out and I suppose I would have to make arrangements beforehand for the cash. Itz almost impossible these days to carry large amounts of cash around. You might need a wheel barrow these days. As a young man back then I used to carry around a Philadelphia bankroll. When I opened up my wallet to the young women, at the forefront would be a twenties and after that would be all one’s. Another trick us young fools would use is to print up business cards touting us as vice presidents of something or other. I ended up marrying a woman who was impressed that I actually had a job.
Review your bank account’s terms as well as state law. You may not be able to withdraw *all* of your money on demand at any time.
Since the biggest “too big to fail” bank is based in a city just a couple of hours from The Woods, my guess that their political influence extends to your state.
Review your bank account’s terms as well as state law. You may not be able to withdraw *all* of your money on demand at any time.
This is codified in Federal law.
You guys use banks? I keep a few bucks in a checking account for appearances and convenience, but I keep my cash in a remote safe.
If the computer or phone goes dark, the numbers disappear.
So does your “crypto.”
This is the Achilles’ heel of BTC. Eventually all the wallets will fail. If a wallet isn’t properly backed up it’s gone. Once all the coins are mined there aren’t going to be any more, so *poof* goes your assets, never to return. There’s a pretty well known case of a man who sued the city to get to run an archeological dig on the landfill to find his hard drive that contained a bitcoin wallet valued at several million dollars. If the drive can be found. And if the wallet can be recovered.
Now there are plenty of cases where cash or artwork are destroyed in fires (the California fires destroyed lots of art, both good and bad), at least that’s something that only affects the owner. If enough bitcoin wallets are destroyed through technical error or stupid, that’s going to influence the value of the asset. If losing your BTC stash is as simple as sudo rm -rf /wallet/ (oh shit!) then will people continue to keep it as an asset?
Where I think bitcoin will be ultimately useful is as an intermediary transaction device. You want to use your pounds sterling, I want to use my dollars. We can bo convert to BTC fairly easily, made the trade then move out to our local currency. Or maybe we want to make a large purchase without having to deal with all the cash handling laws (or risk confiscation in a routine traffic stop), so I load up my wallet with the cash equivalent that morning. We make the trade and you pull your money back out of your wallet at the end of the day.
That all sounds great, but my question is, why do we need “bitcoin” or any “crypto” as this “intermediary transaction device”?
In today’s age, why can’t the “American bank” and “British bank” simply facilitate this transaction sans crypto? If you want to convert US dollars into Pounds Sterling, why can’t that be done digitally, instantly, merely as a facet of ordinary banking service?
Sure, and they have to report all that to their respective governments too. Do that too many times and you’ll find yourself on a watchlist. Then maybe a no-fly list. And the banks will charge a fee for those conversions, there will be wire transfer fees, other fees. Not that trades on BTC are free, but in some cases they might be less expensive.
Besides, it’s nice to have options. Competition in the wire transfer system is a good thing, isn’t it?
Back in the time before unlimited credit we used traveler’s cheques. They were full of fees and lousy exchange rates and charged interest. But they were the only option. When Visa and MC went international making transactions was much easier, and even getting local currency was just a matter of visiting an ATM. But the cards took over and now they’re the monopoly, with the same fees and lousy exchange rates. BTC should help level out the exchange rates and the Lightning network helps with lower transaction fees. Still hard to convert back to currency but that’s mostly due to governments intervention though “Know Your Customer (KYC)” rules.
All of what I just wrote could be said of 1 oz gold and silver rounds too. But you have to carry them around and store them somewhere.
“Still hard to convert back to currency but that’s mostly due to governments intervention though “Know Your Customer (KYC)” rules.”
bisq.network or hodlhodl.com are adequate if you want to transact only a few thousand dollars at a time. Bigger amounts are more complicated – thanks to KYC, as you say – but still doable if you know where to look.
“If a wallet isn’t properly backed up it’s gone.”
When you use language like this it clearly says that you don’t really understand Bitcoin or you have chosen to use language that doesn’t adequately convey the situation.
I have several wallets on my phone. I printed out the actual cryptographic numbers that make up the wallets and have them stored in a safe place. If I accidentally destroy the wallets I can regenerate them. How many people do that?
If a wallet is destroyed without a backup, the BTC will continue to exist, but there is no way to recover them. Effectively they are destroyed.
RK – so you do understand. So why keep calling the recovery key a backup?
As to why people don’t know their recovery key; it the same answer as why people don’t make backups of their precious data and then lose it to a hard drive failure. Human laziness or ignorance; both are unlimited.
The “recovery key” is the wallet. It is a number that is used to verify the owner of the bitcoin. Anyone who knows the number can recreate the transaction.
Thus it needs to be kept safe and confidential. But has nothing to do with “backing up” or accidental deletion of anything.
If the idiot trying to find his hard drive in the landfill had his recovery key, he would still have his Bitcoin.
I disagree with one thing you said and one thing only…”This isn’t to say crypto is evil.”
Wellllll….there is the distinct possibility that crypto is, in fact, the ponzi scheme just waiting to take advantage of the “internet kill switch” that we fear it is.
Which would actually make it inherently evil. On all other things here? We completely agree.
The allure of Bitcoin puzzles me. Its mining involves the use of electricity to solve a mathematical puzzle via brute force (trying all possibilities). Over time, solving the puzzle gets harder.
No wealth is created mining Bitcoins, and a lot of electricity is consumed. Bitcoins can be used to buy things, but with some difficulty. Using Bitcoins in transactions is more expensive than using traditional means.
Some Bitcoin adherents act almost like religious zealots when you question their fervency.
Bitcoin is not like precious metals that have always maintained some value and are tangible. Precious metals do not require electricity to maintain them or a password to retrieve them.
What is the ultimate value of Bitcoin? I don’t know, but I’m not interested is holding a position in them and finding out.
I don’t get it either. Guess the only thing is it exists outside the control of the FedGov.
Lotsa places I go say no to American Express. Wonder how long it’ll be till they say no to Bitcoin.
Bitcoin isn’t outside FedGov’s purview. As someone has said, “Bitcoin’s ledger is completely transparent and not anonymous to the tax man, contrary to gold, which can be lost countless times in fortuitous boating accidents.”
Bitcoin “exists outside the control of the FedGov.”
Nope. The FedGov admitted in 2023 to holding 200,000 Bitcoins. Since they’re liars, they probably hold much more. Thus, FedGov is a whale in Bitcoin. A “whale” is a person or corporation or government or organization owning a LARGE percent of any particular crypto.
Whales have a huge influence, if not outright control, of the supposed “value” of the crypto. Thus, whales can buy or sell to push the price up or down. And knowing this in advance, they can profit off the fluctuation in price either way. Thus, obviously, they can crash the price in order to wipe out we who are not in their “club.”
The controllers of the government, and the Federal Reserve, and large corporations, and the big media, are in that “club.”
(Click on my name to go to my website and see my latest show, which expands a bit on this topic.)
Mike: “I don’t get it either. Guess the only thing is it exists outside the control of the FedGov.”
But I still wonder how the feds recovered some large portion of a ransom attack (the details escape me now) paid in bitcoin. Surely, they have a way in.
But I don’t understand it either. And I guess I do agree with Warren Buffet on some things. Never invest in anything you don’t understand. One thing I do understand is that if the lights go out, I can’t use my crypto. In that case, even if I hid my phone under my mattress, I go hungry.
Chumba Chumba Chumba. . .