Can I say that I hate Bitcoin!!

LeFinancisteLeFinanciste Posts: 42 Copper ✭✭
Just wanted to launch this topic to take the pulse of the community on this subject.

I am a Bitcoin Hater!! At sometime this morning the value of a Bitcoin inexplicably lost near 30% of its value and I was SO Happy about it. It literally made my day! I don't understand the interest for yet another FIAT currency. Yes, "Bitcoin lovers", I said FIAT because you can try to explain to me the concept of chainblocks, bitcoin mining and the super power of thousands of computers together, it is just a COMPLEX fiat currency! It is still backed by confidence and a really complex math equation with a random good answer ounce every ...I don't know how many attempts, but exponentially longer every time...

Can you understand the rally that just happened? A bitcoin was the same value as an ounce of real, palpable, perfect, powerful, free, unshakeable and unhackable GOLD! This rally double the value of a bitcoin in a year... It should have been Gold's rally! Only gold is the real safe heaven! And, with China monetary problems, Brexit, Deutsch bank, Trump elections, Italy referendum, Monte Paschi Balout... with War on cash in India, Australia, Sweden, Venezuela and who know where next... It should have been Gold and silver's time to shine! They did ok, but should have been spectacular...The only advantage of a bitcoin and for now it is a big one, is that the big banks don't know how to rigged this market... yet!

We look like lunatics whenever we talk about gold at 10 000$ and silver at 1000$... I saw this week a youtube video, I think it was: 1 000 000$ Bitcoin is conservative... How Condescending! (Sorry if the author is a Goldmoney Bro.)

So, I hope to see the bitcoin crash, burn and being hacked to death in 2017. And I wish it will freak you out "Bitcoin lovers". I would be happy to give you my Golden heart Referral Link to help you get back on your feet!

Can you imagine how zen I feel now that I unload myself of the burden of Hiding all this hate. People tend to believe that when you are a gold bug, you love all alternative investment... I do... Just not Bitcoin!


  • 79Au19779Au197 Posts: 4,047 Gold ✭✭✭✭✭
    @LeFinanciste I gave you a "like" just to offset the "disagree". Everything you say about gold is true, but hate is such a useless emotion. Many are playing Bitcoin / block chain as a speculation. Gold is backed by gold. Bitcoin is backed by?

    I personally think that the Bitcoin / block chain interest is analogous to the 1637 Tulip Bulb Bubble.

    Of course their are some that see gold on this light as well, but history proves otherwise.

    I think that Bitcoin / block chain has a place as alternative currency, but I do not see it supplanting gold.

    Recently someone posted a link to a fascinating infographic showing the relative size in dollar terms of Gold, Silver, Bitcoin, stock valuations, various money supply term, and debt. I can't find it, but perhaps the poster will read this and post the link.

  • GoldIsCurrencyGoldIsCurrency Posts: 1,814 Gold ✭✭✭✭✭
    @LeFinanciste I personally don't own any bitcoin but BTC does have some merits above paper fiat currency. At this point I think it is a choice in what one believes in and it is their choice. I hold gold and commend others in choosing a different medium besides paper currency. The more knowledgable bitcoiners also own gold for its merits and proven history.

    Josh Crumb who is one of the Founders of Goldmoney for those that don't know wrote an insightful article on bitcoin and gold two days ago. I presume with some media around bitcoins recent surge. As he commented bitcoin would need to surge by 32,000% to be in parity with golds value. Josh and Roy are obviously extremely intelligent, they own precious metals but it is my understanding that they both also hold a personal position of bitcoins.
  • GoldmattersGoldmatters Posts: 4,051 Admin
    Great piece, thanks for posting GMH @GoldIsCurrency
  • paddy10tellyspaddy10tellys Posts: 249 Bronze ✭✭✭
    Make new friends, but keep the old; those are bitcoins, these are gold...

    Likewise, I much prefer physical gold but suspect that It might be prudent to be open-minded and invest in a few bitcoins while it all plays out.

    What I won't invest in is cults & their black-and-white thinking, low tolerance of ambiguity and relentlessly judgemental attitude about non-groupthink ideas
  • LeFinancisteLeFinanciste Posts: 42 Copper ✭✭
    Thank you friends! Special thanks to you @79Au197 for giving me a good point about looking at bitcoin as the Tulip Mania! (And for offsetting my disagree :wink: !)

    I want to apologize if I offended some people with my tone. It is hard to do it by writting (maybe because I am french canadian) but I was trying to be satirical :smiley: . I know" hate" is a big word and I was using it to stir things up! I love a good heated debate!

    Thank you for your comments!! Love you all!
  • GoldStandardCanadianGoldStandardCanadian Posts: 148 Bronze ✭✭✭
    edited January 2017
    Any form of money is always backed by one common denominator: Confidence.

    Now there are reasons why some people would buy Bitcoin over gold. We are seeing increasing capital controls and Bitcoin is a lot easier to hide from a government monitor. It is cheaper to store than Gold, can be purchased or generated electronically, and has become globally accepted and can be traded for FIAT currency. Many people are now flocking to Bitcoin not because they really like it, but because capital controls necessitate action to preserve wealth.

    On top of that point, I tend to agree with Jim Rickards in saying don't put all your investment in one basket. Diversify.

    Any respectable investment advisor will recommend a 10-15% allocation in precious metals as an insurance policy on one's position. This is basically the recommended allocation to hedge against the inflationary factors that exist in dollar-denominated equities like stocks, or even cash. One theory is that if the USD succumbs to hyperinflation, the precious metal allocation will cover your losses as gold/silver becomes an obvious safe haven. This sort of professional advice is moreso insurance advice, than investment advice, but is necessary when weighing an investor's portfolio. The inverse relationship between gold and FIAT is well documented, as is the eventual fate of the death of the US dollar for anyone who does their own research and due diligence on the subject.

    But cash is good to have on hand as well despite inflation. Some of the richest people in the world have a pretty simple strategy, which is wait for a market crash to happen, or something causing a big discount, and then use the cash to buy in massively. Warren Buffet has used this strategy and while it is very no-frills, historically it is very effective. And JP Morgan is using this strategy by being the biggest hoarder of Silver in history - obviously they will be well-positioned when a crash happens... especially if you have realised the ratio between gold and silver price correlated to gold and silver output (76:1 price vs 10-17:1 output) ... infers that silver is really worth closer to $1000 per ounce, so when SHTF, JP Morgan will once again be ahead of the pack. Not to mention all the banks that have been prosecuted for deliberately manipulating the silver price. I'm not a fan of conspiracy theories, but this one's been busted. Silver is nearly worth its weight in gold right now.

    Right now I have zero bitcoin allocation. I think that the gold 'token' idea that Roy Sebag has been working on is a superior concept to Bitcoin and I may be interested in investing in that when it is released. However as long as people have confidence in Bitcoin, wether I like it or not (and I don't particularly because I don't trust it due to security issues, and the fact it's been hacked once already), I would be foolish to say that it isn't a form of money. And any form of money, throughout history, has been shown to have its own unique risks. Nothing is bulletproof. That's why it's important to diversify. Money itself can be characterized with similar complexity theory and behavioural factors that we see in the markets today. There's no easy answer. Gold just happens to be a very good answer and maybe one of the best ones out there, but don't be fooled.
  • AnacapAnacap Posts: 91 Copper ✭✭
    What is money?

    Something that is quickly liquidable and has little to none volatility, and that's backed up by the past. That's it an intersubjective value at the end of the day, confidence, even with gold. Gold as money is part of human history and BTC is a new thing, even if it's getting less volatile, it's still is.

    Properties are objective, not value.

    Gold has been subjected of money because it's phisical properties are really practical for use.
    These properties are copied by BTC and pushed further with a whole different level of reasonable utilities, like anonnimity and nengible transaction costs killing the intermediary. It's safety relyies on the user knowledge only. Unlike gold, it's counter intuitive and too abstract to appeal to our guts.

    Then there's for example Ethereum, that copies BTC and adds up a whole different dimension allowing to design or programe contracts over your money, so your deals take care of themselves!

    And more that will come, personally I'm expecting a cyptocurrency that is backed up by gold, as that would add up nengible transaction cost to gold!

    All these qualities are really interesting and hold a serious long term value.

    Short term picture of bitcoin is an hype train. Most users are in because of viewing it as an investment.
    Nowadays the point of btc is using it to expoit it's properties IMO, unless you want to put yourself on stress tests.
  • AnacapAnacap Posts: 91 Copper ✭✭

    So, I hope to see the bitcoin crash, burn and being hacked to death

    BTC wasn't hacked, third party services that offered management of their user's wallets got hacked. To use btc you don't need to use these services, and even if you do, you can always hold your btcs on your own.

    Security is up to the user. Sad truth is, most internet users have zero notions about security :smiley:
  • LeFinancisteLeFinanciste Posts: 42 Copper ✭✭
    Good answer @GoldStandardCanadian , I like the diversification like you said and I agree with Jim Rickards. The fact is, James Rickards own No Bitcoin in is allocation. He Is promoting a portfolio of Precious Metal, Fine Art, Private equity, venture capital And Cash... Lot of it for now.

    Peter Schiff doesn't Own Bitcoin and don't talk about it in a kindly manner. I would like to know if Warren Buffet owns any :smile:
  • GoldStandardCanadianGoldStandardCanadian Posts: 148 Bronze ✭✭✭
    edited January 2017
    Warren Buffet is a very interesting guy! He has consistently spoken very disfavourably against gold, as he prefers equities that offer "organic growth". He is also conscientious of the risks posed by derivatives and described them as "financial weapons of mass destruction". Which is a bit weird that he still doesn't use that argument to substantiate gold, given the risks inherent with central banks right now. What I conclude is that Warren Buffet is not a saver, and financial protectionism is not something he exercises in a direct manner - but rather on growth, or "organic growth". He prefers owning the farm than the soybean, so to speak. Warren Buffet seems to understand risk very well, and his track record speaks for itself, whether people agree with him or not.

    On Bitcoin, Buffet has this to say:

    "Stay away. Bitcoin is a mirage. It's a method of transmitting money. It's a very effective way of transmitting money and you can do it anonymously and all that. A check is a way of transmitting money, too. Are checks worth a whole lot of money just because they can transmit money? Are money orders? You can transmit money by money orders. People do it. I hope bitcoin becomes a better way of doing it, but you can replicate it a bunch of different ways and it will be. The idea that it has some huge intrinsic value is just a joke in my view."

    Of course Buffet is not addressing the fact that Bitcoin is decentralized, and with capital controls ongoing and expanding it is quite different from chequing accounts or just another transmission of wealth method. But perhaps Buffet doesn't subscribe to the ICE 9 doomsday theory, or at least not publicly.

    Buffet has a lot of critics, but no one can say he does a bad job of making money - he is very good at that, and probably has spent most of his time researching the best way to do that. I suppose in that respect, while he's making money, he's also saving money too.

    For the rest of us money-savers though, given the risks that Buffet doesn't fully talk about related to currencies, I think gold is insurance, a hedge on inflation, and with surging demand, might actually earn more purchasing power, even while it's not traditionally known for that.

  • MelanieMelanie Posts: 1,045 Gold ✭✭✭✭✭
    Our Goldmoney Insights team recently posted a piece that may be of interest to this discussion!

    Check it out here!
  • LeFinancisteLeFinanciste Posts: 42 Copper ✭✭
    Thank you @Melanie ! It is a really interesting post!
  • SpontaneousOrderSpontaneousOrder Posts: 302 Bronze ✭✭✭
    Confirmed Bitcoin transactions are running at a maximum of about 325,000 per day, and there's 86,400 seconds per day. That works out to less than 4 transactions per second. The VISA network handles 10,000 times that, and the Goldmoney network will easily scale to whatever is needed. It might be possible to tweak Bitcoin to get it up to 40 or 50 transactions per second, but going beyond that will require a complete re-design, which would render all the hardware investment worthless. Obviously Bitcoin can never be a practical system. What Mike Hearn said a year ago (see "The resolution of the Bitcoin experiment") remains true: Bitcoin was an experiment, an experiment that has failed. Why people continue to gamble so much money in the Bitcoin bubble is beyond me. The malinvestment is extreme. If the world wants a crypto-currency, there are other, far better ways to do it.

    If I had any Bitcoin I'd definitely unload it all to the Goldmoney Dubai vault. I wouldn't even care that I couldn't spend the gold via the Mastercard because I could still redeem the gold to my bank account. I would get out now before it's too late. It's better to be a year too early than an hour too late.
  • GoldmattersGoldmatters Posts: 4,051 Admin
    This is a great discussion. Kudos to the Goldmoney community for talking about these important topics!

    I would like to point out because I have not seen it mentioned here a device called Trezor. Some of you that like Bitcoin might find this interesting. It is essentially a "Bitcoin Safe" that mitigates the concern about your bitcoins being hacked or stolen.

    Essentially the Trezor is a "cold storage wallet" meaning you transfer your bitcoin to this device, kind of like a thumb drive, and its completely offline.

    Bitcoins can be stored on the Trezor and the trezor can be kept anywhere, like in a safe.

    FYI :)
  • AnacapAnacap Posts: 91 Copper ✭✭
    edited January 2017

    Bitcoins can be stored on the Trezor and the trezor can be kept anywhere, like in a safe.

    The point of cryptocurrencies is that you can diversify, let's say, in different form of vaults, as you're your bank. So if one is lost for some reason, like you lose it or it gets broken, you can still access from the other way.

    As I understand, this applies only if you manage your own keys personally. And as it's personal, you can make them as safe as you want, as you can encrypt them, put them behind a password, and even with double-checks like biometric scans or smarthphone confirmation, so it doesn't matter you hold them phisically or even online. The data is unreadable.

    I don't see the point in things like those Trezor devices, it's not really the simpler solution to make them safe.
  • GoldmattersGoldmatters Posts: 4,051 Admin
    @Anacap You could be right. Though to some bitcoin users diversification may also mean keeping a portion them completely offline. I understand your point though, the Trezor is not for everyone
  • 79Au19779Au197 Posts: 4,047 Gold ✭✭✭✭✭
    From the article @Melanie cites above

    Unlike fiat currency, it can’t just be printed, and it mimics the scarcity properties of gold in that it needs an enormous amount of energy to create one coin.

    So @LeFinanciste you should reconsider your original statement that Bitcoin is "yet another FIAT currency." In fact Bitcoin is absolutely not FIAT because its value is based on price discovery and perceived value by the buyers and sellers.
  • 79Au19779Au197 Posts: 4,047 Gold ✭✭✭✭✭

    What you implied, but did not specifically say is that a Bitcoin position is a gamble (not a speculation, not an investment, not savings). It has high volatility and it it largely anonymous. But it is only worth what the buyer and the seller agree upon. When folks start cashing out, you don't want to be the last person in line.

    Of course to some extent gold and stocks can be gambles as well (at least in the short term), but gold has history on its side.
  • paddy10tellyspaddy10tellys Posts: 249 Bronze ✭✭✭
    edited January 2017
    One's head can be removed from one's bleep if one cares to take a paradigm-shift...
  • paddy10tellyspaddy10tellys Posts: 249 Bronze ✭✭✭
    edited January 2017
    and so the apple is faulted for not being an orange @SpontaneousOrder it is a false analogy to equate Visa & the bitcoin network.

    Mike Hearn should Trollax, see

    The biggest problem bitcoin faces is that most commentators don't know enough computer science & economics to properly understand it, so it becomes witchcraft. Debate always degenerates into argy-bargy.

    FinTech pioneers like Goldmoney don't need to be afraid of Bitcoin, they need to leverage it.
  • 79Au19779Au197 Posts: 4,047 Gold ✭✭✭✭✭
    @paddy10tellys said

    One's head can be removed from one's bleep if one cares to take a paradigm-shift...

    Not sure who or whose comment that referred to.

    This whole gold vs Bitcoin "war" reminds me of (decade by decade)

    Apple vs Samsung (mobile devices)
    iOS vs Android (mobile OS)
    MacOS vs Windows (operating systems)
    Mac vs PC (computers)
    VHS vs Beta (video tape)
    Apple II vs TRS80 (computers)
    Algebraic vs Reverse Polish Notation (see TI vs HP below)
    Texas Instruments vs Hewlett-Packard (calculators)
    Ford vs Chevy vs Dodge (cars)

    I am always amazed at the level of emotional involvement folks work themselves up to. I say this from both observation AND personal experience.

    Technologies are born, evolve, thrive … or die.

    Bitcoin and block chain are technologies. They will thrive or die.

    Gold and silver will always be.

  • LeFinancisteLeFinanciste Posts: 42 Copper ✭✭
    I have to say I love this discussion and the way it going!

    I have to disagree with my new friend @79Au197 (I am new to the community and consider you all as friends :smile: )on your last statement. Even with a price discovery mechanism and scarcity... Bitcoin has absolutely no intrinsic value. It could go to 0$ if we loose fate in it and even if it takes a incredible amount of energy to produce. Gold or silver could never go to zero. Even a kilo of sand has a price... Low, I agree, but it has a value even if the scarcity is not an issue...
    I would quote a part of the very definition of Fiat Money from Wikipedia:
    ''Intrinsically valueless money used as money because of government decree''
    We could say that the fact that Gouvernment did not banned or criminalized the usage of Bitcoins is a form of acceptance / decree.
    I have to keep the fiat statement as is and would need a lot more to be convinced otherwise :smiley:

    Do we agree to disagree?
  • LeFinancisteLeFinanciste Posts: 42 Copper ✭✭
    edited January 2017
    Sorry I don't know how to quote you well with this format, but love your last statement:
    "Technologies are born, evolve, thrive … or die.

    Bitcoin and block chain are technologies. They will thrive or die.

    Gold and silver will always be."

  • 79Au19779Au197 Posts: 4,047 Gold ✭✭✭✭✭
    @LeFinanciste said Do we agree to disagree?

    Actually I prefer to agree to agree. You said that Bitcoin has has absolutely zero intrinsic value. I agree.

    That is why IMO Bitcoin is not FIAT because FIAT has whatever value the issuing government says it has.

    Gold and silver could never go to zero. On this I also agree. *

    I am however willing to agree to disagree on the level of our agreement. B)

    * unless of course the future resembles …

    After successfully stealing a gold shipment, a group of criminals and their scientist accomplice put themselves in suspended animation in a remote desert cave. When they awaken decades later, complications ensue when their truck is destroyed.
  • paddy10tellyspaddy10tellys Posts: 249 Bronze ✭✭✭
    edited January 2017
    Not a comment about comments @79Au197, more an observation about discourse in general...

    For the record: Physical gold is sui generis and will still be here when our sun is a white dwarf... but in the meantime technology is evolving that makes it even more useful/desirable/valuable and that is an opportunity, not a threat :-)

    Edit: LOL++ the film clip is wonderful

  • 79Au19779Au197 Posts: 4,047 Gold ✭✭✭✭✭
    @paddy10tellys said

    For the record: Physical gold is sui generis and will still be here when our sun is a white dwarf... but in the meantime technology is evolving that makes it even more useful/desirable/valuable and that is an opportunity, not a threat :-)

  • GoldmattersGoldmatters Posts: 4,051 Admin
    @79Au197 Great discussion! Yes, @LeFinanciste you are amongst friends here :) I like to think we are all here are mostly on the same side. Not saying that there cant be conflicting options and viewpoints, but mostly on the same side.

    Im fairly certain there arent many folks here that regularly talk about how awesome fiat currency is, or are overly anxious to rush into dollars.

    I havent seen many debates here about how a dollar bill is better than gold or bitcoin.

    Thats puts us all in in the same boat, generally.
  • LeFinancisteLeFinanciste Posts: 42 Copper ✭✭
    @GoldMatters Well said ! Totally agree!
  • 79Au19779Au197 Posts: 4,047 Gold ✭✭✭✭✭
    edited January 2017
    @GoldMatters said

    I havent seen many debates here about how a dollar bill is better than gold or bitcoin.

    The gauntlet is thrown. I will take the bait. >:)

    Why the dollar bill (USD in the case) is better than gold or Bitcoin …

    1) accepted everywhere in all of its forms (paper, coin, check, credit/debit card) 24/7 by everybody
    2) fully fungible and liquid - it is the very definition of currency and money
    3) the only recognized form of money for paying taxes ("render unto Caesar what is Caesar's)
    4) pure cash transactions are private and untraceable (and do not require computers)
    5) the USD holds its own against other currencies
    6) it is the current unit in which both oil and gold are priced and sold
    7) it is the unit of accountability for transactions on all of the US stock exchanges
    8) it the unit of value in which US workers are paid
    9) it is a convenient and legally mandataed unit of exchange (see item one)
    10) it does not incur capital gains taxes or losses when used

    Note: I had to stretch for some of those toward the end.

    I am willing to debate the validity of each point above, but I suspect that you would be hard pressed to present evidence to the contrary. However all of the above is "slice of time" - spend it as you get it. Nowhere above have I addressed the question of lasting store of value. Gold and silver have historically been a lasting store of value. Bitcoin / block chain are too new to have an established track record in this regard.

    There are many additional points we could discuss/debate/argue which I will leave to others to broach.

    One final point I would make about the above list it that it is parochial - that is local, isolated from international trade and foreign exchange complications. Whereas local cash transactions are "private and untraceable", international transactions are not. In this case Bitcoin / block chain has the advantage. Goldmoney itself fails to be "private and untraceable" due to its adherence to transparency.

    If you deal internationally and must maintain total privacy, Bitcoin / block chain would appear to be the better choice. That is of course why global governments are sceptical of Bitcoin / block chain.

    Finally having a stash of local currency on hand is always a good idea.

    I welcome your rebuttals.

    PS for newcomers: despite my ten points above, I subscribe to the J. Pierpont Morgan 1912 quote

    Money is gold, and nothing else B)

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