Bitcoin

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Manchesteral
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Re: Bitcoin

Postby Manchesteral » Mon Dec 11, 2017 6:13 pm

Well, interesting thread this has been, as a final remark I would add that last Tuesday I was at a house party hosted by my cousin who happens to be an investment banker, he told me the following. the only people who invest in bitcoins are the ones who truly do not understand commerce ! it has no treasury backing anywhere in the world and is merely a very cleverly manipulated ponzi scheme, he reckons there will be untold misery when it crashes (sometime early next year).
I don't know if his predictions will come true but he has made a lot of money from his banking activities and I trust his word.
My thanks once again to all who helped in this topic and my comments here are not intended to be critical or personal :)

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Flexo
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Re: Bitcoin

Postby Flexo » Mon Dec 11, 2017 6:52 pm

Again, of course bitcoin does not have any treasury backing because it isn't a currency, it is a commodity. An investment banker that doesn't understand the difference between a commodity and not a currency maybe should get a new job. Besides, almost no currency on the planet are backed by commodities these days, the last big currency using the gold standard was the US dollar and they are today only backed by the word of the US government.

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gus
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Re: Bitcoin

Postby gus » Tue Dec 12, 2017 12:17 am

It’s the only “commodity” I am aware of that exists only as an idea :/
Mind you, my understanding has always been, at least since I became involved in the real world, that a commodity was something that could be touched.

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Flexo
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Re: Bitcoin

Postby Flexo » Tue Dec 12, 2017 8:59 am

A commodity is a concept, so it is a virtual commodity and not a virtual currency. It is overvalued yes, but not because it is worthless but because there are other cryptocoins that are better. Big difference. Investors and so called experts that claim it is worthless either have no clue what they are talking about or they have vested interest in trying to kill the concept because cryptocoins are here to stay and they are going to kill regular currencies eventually. There already is a cryptocoin in Kenya whatever it is called that has more use than regular currencies.

Manchesteral
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Re: Bitcoin

Postby Manchesteral » Tue Dec 12, 2017 11:01 am

So Flexo, you're trying to convince me that "bitcoin" or "bitcon" as my cousin ( who's probably made in excess of €20.000.000) using his own money, terms it, has the same fundamental value as gold, diamond or oil , i doubt that and I hope you haven't over exposed yourself in the market !!

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Re: Bitcoin

Postby anyroads » Tue Dec 12, 2017 1:22 pm

I am surprised someone has not come up with the term "fools gold"...

It seems Chinese housewives are piling in !

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Flexo
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Re: Bitcoin

Postby Flexo » Tue Dec 12, 2017 7:20 pm

Manchesteral wrote:So Flexo, you're trying to convince me that "bitcoin" or "bitcon" as my cousin ( who's probably made in excess of €20.000.000) using his own money, terms it, has the same fundamental value as gold, diamond or oil , i doubt that and I hope you haven't over exposed yourself in the market !!


You can buy commodities in terms of gold, copper, oranges or bacon. Neither has an intrinsic value by itself, it is the market that creates the value. If you think that gold has a fundamental value let me tell you that there is one single asteroid outside of Mars that has enough gold in it to totally crash the world gold market making gold as an investment totally useless. What makes the value of a cryptocoin is the design and function. Also this notion that it is worthless because it is an abstraction is particularly absurd given the fact that the financial market is filled with trades of abstract financial instruments like derivative trades and what not.

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Re: Bitcoin

Postby Parilla » Wed Dec 13, 2017 4:56 am

An "investment banker" who uses his own money ?? That's a rare bird.

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Manchesteral
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Re: Bitcoin

Postby Manchesteral » Wed Dec 13, 2017 8:21 pm

He inherited a house which he sold, then bought two terraced houses turned them into 4 rental flats, then bought two more and so on, he now owns around 40 rental properties.

Along the way he has dabbled in currency markets, start ups and a number of other things.

He has two strings to his bow, 1, he regularly invests part of his income in new projects, 2, he invests other peoples money on their behalf.

I agree it appears unusual for investment bankers to use their own money but I'm pretty sure they do !!

anyroads
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Re: Bitcoin

Postby anyroads » Mon Dec 18, 2017 6:44 pm

Interesting snippet about "mining" of bitcoins in the paper over the weekend.

There are now over 16 million of the 21million ( allowed ! ) in existence. A lot of the new ones are produced in mega Chinese warehouses set up especially. It seems it takes about $14,000 in electricity costs to mine one new bitcoin at the moment. This increases with every new coin "minted".

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Flexo
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Re: Bitcoin

Postby Flexo » Tue Dec 19, 2017 3:56 pm

Last time I checked it cost about 1600 USD to mine 1 BTC but that is not including the hardware costs. Right now it is probably more profitable than it was in September but you have to separate the energy costs, the hardware costs and the opportunity cost. I think right now the energy consumption for one transfer is 250kWh which is of course insane but I don't think that amounts to 14000 USD given that there is very cheap solar power available now even during the winter.

Edit: for BTC you are not rewarded by each transfer I remember now, you get a chance of winning 50 BTC or something like that.

If you are interested in mining cryptocoins I would suggest you look into Monero mining as that is something you can do even with a regular computer and even if you just make a few coins in a year in a few years that could be worth hundreds of thousands.

For example, I had a bitcoin last year that I bought for like 40 EUR, if I hadn't spent it I would have had an extra 15000 EUR now. Now I only have 0.3 BTC left, poor stupid me.


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