[HN Gopher] Coinbase mafia shows how tight a circle holds sway o...
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Coinbase mafia shows how tight a circle holds sway over Bitcoin
Author : T-A
Score : 131 points
Date : 2021-02-28 08:37 UTC (14 hours ago)
(HTM) web link (www.bloomberg.com)
(TXT) w3m dump (www.bloomberg.com)
| ffggvv wrote:
| is bitcoin truly decentralized? in the sense that there's a
| centralized ledger that anyone can access and see transactions? i
| know the ledger is copied and decentralized to all nodes but for
| instance if i go on the street corner and buy something with
| cash, no one in the world knows other than the participants. with
| bitcoin everyone in the world knows and it's recorded for all
| time
| asdev wrote:
| unrelated comment: it's crazy how anti crypto and anti blockchain
| HN is for being a tech community
| betterunix2 wrote:
| What's crazy about that? There are strong technical arguments
| against Bitcoin and related cryptocurrencies. Bitcoin is an
| environmental disaster that uses as much energy as a large
| country to process a tiny number of transactions. The security
| of Bitcoin is backwards, requiring honest parties to do _more_
| work than attackers. Ultimately Bitcoin was not even designed
| to solve any specific technical problems, just a vague, open-
| ended goal of "decentralization;" it was more of a political
| statement than anything else...
| hertzrat wrote:
| And with the main goal being decentralization, almost the
| entire blockchain is controlled by a few groups of miners and
| hoarders. It's as or more centralized than ordinary currency
| betterunix2 wrote:
| Except that "decentralization" is not a specific goal; it
| is vague and open-ended. Bitcoin has always relied on
| central authorities of some sort -- for a long time the
| peer-to-peer bootstrapping strategy was highly centralized
| (in an IRC channel), and everyone takes for granted the
| role of IANA and RIRs in making all Internet applications
| possible. So why should we complain about miners, hoarders,
| and exchanges? When you never specifically define your
| goals, it is easy to ignore inconvenient "problems."
| totalZero wrote:
| If bitcoin has technical weaknesses you'd expect the dissent to
| come from the technologists first, no?
| matvore wrote:
| Cryptocurrency promotion implies to some extent that central
| control of money is a bad thing. So it is somewhat political.
|
| I think most HN folks are against it for political reasons to a
| certain extent. Even if they say they aren't, they are getting
| their information from and socializing in a bubble with a
| political bias.
|
| There are some news topics on HN that i will never read the
| comments of because of how motivated and biased the reasoning
| is behind them. Bitcoin comments I will still read though,
| since it's fun to see everyone's tone and reasoning evolve as
| Bitcoin slowly gets more traction and rises in price over time.
| dmitriid wrote:
| There's nothing political in the simple fact that Bitcoin
| (and blockchains in general) is a bad technology for any of
| the uses that it's advertised for:
| https://medium.com/@kaistinchcombe/ten-years-in-nobody-
| has-c... (and the second part, linked directly from that
| article)
| paulryanrogers wrote:
| Is it? Would it be crazy how anti-homeopathy a medical forum
| could be?
|
| Perhaps a tech savvy community is more aware of the flaws of
| BTC, and therefore more bearish on it's prospects.
| [deleted]
| sidlls wrote:
| What about being a tech community suggests it should not be
| anti-crypto/blockchain?
| rchaud wrote:
| It may be because cryptocurrencies in their present state
| represent little other than a electricity-hungry 'store of
| value' rather than its considerably loftier original goals.
| 177tcca wrote:
| "Represent" in the public and media mind share.
|
| What the technology actually is capable of, and is doing
| today, these are different things.
| rchaud wrote:
| Sure, but we are not commenting on a story about crypto-
| related applications. The story is about a centralized
| exchange going public. Coinbase doesn't care what dApps
| will be created on Ethereum or whatever, in the same that
| my broker doesn't care about how my GME purchase will
| strike a blow for the little guy. They're both just there
| to pick up their cut.
| 177tcca wrote:
| Just a few days ago, I saw their promotions on their page
| offering a bit of new coins to learn more about their
| specific utility and technology behind them.
|
| I dunno.
| tiku wrote:
| We can't even begin to imagine all the new tech that will use
| blockchain (related) tech yet. The money making is just the
| "nasty" part of it now.
|
| A recent development is that of NFT's for example. And the
| smart contracts thing is just understandable for us tech nerds,
| but if all our customers and entrepeneurs get wind of it..
| brace yourself.
| dmitriid wrote:
| > We can't even begin to imagine all the new tech that will
| use blockchain (related) tech yet.
|
| Perhaps because it doesn't, and can't produce any "new tech"?
|
| > And the smart contracts thing is just understandable for us
| tech nerds, but if all our customers and entrepeneurs get
| wind of it.. brace yourself.
|
| No one will brace themselves. Smart contracts have
| innumerable problems that cannot be solved, and are inherent
| in the fact that it's just a piece of technology, and
| technology by itself can't do anything.
|
| 1. They are digital only. And can only govern things that can
| be programatically checked. So, anything that can't be
| checked (for example, delivery of physical goods) is out of
| the question. If you say "but yes, those things can be
| provided by people", you're back to being no better than
| regular contracts (which also have a bunch of laws and
| regulations around them protecting all the parties in the
| contract).
|
| 2. They require all involved parties to understand, vet and
| audit programs written in any number of esotheric programming
| languages. Yeah, good luck with getting customers and
| entrepreneurs getting wind of it.
| dmitriid wrote:
| Because, and bear with me for a moment, the tech community
| understands how worthless this technology is?
| Traster wrote:
| It is kind of funny that exchanges have become so successful for
| Bitcoin- since they lose 100% of the stuff that made BTC
| attractive in the first place. They're centralised, regulated and
| transactions don't even go on the blockchain.
|
| The result is that the number 1 way people get into Bitcoin is
| through a mechanism that has none of the attributes of Bitcoin.
| pedalpete wrote:
| That's the way people "get into it", as you need to be able to
| purchase bitcoin somehow, and atm, the easiest way is through a
| centralized exchange. There needs to be a level of trust when
| you are moving from a centralized system to a decentralized
| system.
|
| But once you have your cyrpto, you can move it to your own
| wallet, or anywhere else you'd like. I can't do that with fiat
| currency.
| DennisP wrote:
| The decentralized exchanges are on Ethereum. Uniswap alone has
| over $100 billion in cumulative volume so far.
|
| But if you want to interact with legacy banking systems then of
| course you need an exchange that's hooked into all that. I
| don't see why that should surprise anyone.
| esperent wrote:
| Exchanges reduce risk and make things easy for casual users. By
| casual, I mean people who just want to invest and don't care
| much about the mechanics of bitcoin which was always going to
| be ~99% of users.
|
| What are the other options? Using an exchange is risky (or at
| least seems risky to me, a person with almost zero crypto
| experience). Bitcoin ATMs? I know they exist, I've never
| personally seen one. Handing cash to a stranger? Definitely
| risky.
| rchaud wrote:
| > It is kind of funny that exchanges have become so successful
| for Bitcoin
|
| When everyone's prospecting for gold, sell shovels.
| andrewtbham wrote:
| I think the fixed supply is what attracts people.
| mcguire wrote:
| Which results in long-term depreciation, such that _spending_
| bitcoin is economically irrational.
| EVa5I7bHFq9mnYK wrote:
| It is not so, because humans have finite life span. So they
| MUST spend their coins within a fixed time frame of about
| 70 years.
| read_if_gay_ wrote:
| > They're centralised, regulated and transactions don't even go
| on the blockchain.
|
| Of course. All of that is kind of unavoidable if you want to
| interface with fiat.
| vbezhenar wrote:
| Not really. I can buy bitcoins on localbitcoins and it's
| pretty decentralized.
| robcohen wrote:
| Under US law it is illegal to use localbitcoins. It's a
| violation of money transmitter laws.
|
| https://kelman.law/blog/money-transmitter-licensing-for-
| u-s-...
| gruez wrote:
| Only if you're a business, right? Does offering to buy
| 500 euros off your friend because he have some left over
| from his european vacation make you a MSB?
| yawnr wrote:
| Your friend would be the money transmitter in this case
| and at that scale no one would care, but if he did it
| with 1000 "friends" then, well yeah. People have gotten
| arrested and charged for operating on localbitcoins
| without proper licensing.
| seibelj wrote:
| There is a difference from selling a few cars to
| strangers, and setting up a car-selling business which
| would then be subject to a bajillion rules and
| regulations.
|
| The same for selling bitcoins. You can do it a few times
| but if you make it a business you become a MSB.
| PaulAJ wrote:
| That isn't quite true. Money business laws only apply to
| people doing it as business, so your friend is in the
| clear de-jure as well as de-facto. One of the things a
| prosecutor would have to prove as part of the case is
| that this was in fact a business. Typically this would be
| done by showing that he had been listing both buy and
| sell on localbitcoins.com and/or by setting up a test
| purchase that showed he was dealing with anyone who
| showed up.
| viraptor wrote:
| The fact you got to the localbitcoins service and tell it
| who you do the exchange with makes it at least a
| centralised place of information.
| 177tcca wrote:
| So basically the consumer tech hasn't yet caught up with
| the technology, is what you're saying?
|
| Once there are enough people buying and selling for cash,
| you'll just need to find an old payphone, or some other
| known meeting place, if popular technical means are
| legislated away.
| [deleted]
| saurik wrote:
| And yet, you did get there, and once there you interoperate --
| permissionlessly -- with any other exchange.
| dehrmann wrote:
| > The result is that the number 1 way people get into Bitcoin
| is through a mechanism that has none of the attributes of
| Bitcoin.
|
| Sure, but 95% of people don't care about that. They just want
| an asset they will go up. Everything else is just a story
| people tell themselves so they're not putting 20% of their net
| worth in trading cards.
| anonisko wrote:
| Every store of value that has ever existed and will ever
| exist is just a game of speculation that it will continue to
| be valued when you're ready to withdraw your money to do
| things you've saved for.
|
| Gold was the best portable and fungible speculative bet for a
| very long time.
|
| Bonds are speculation that a country will continue to be
| productive and well managed enough to pay their debts without
| resorting to massive inflation.
|
| Stocks are a speculation that a company will continue to be
| competitive and profitable for long enough to recoup your
| investment.
|
| Real estate is a speculation that an area will continue to be
| a desirable place to live or useful for some industry.
|
| Rare art is a speculation that people will still be willing
| to pay millions for your original Picasso and that we won't
| be able to produce undetectable copies with better
| technology.
|
| Bitcoin is a speculation that people want a digital, neutral
| store of value like gold was that they can park excess money
| in that they don't have a better use for right now.
| ForHackernews wrote:
| I disagree with this: there's a genuine difference between
| non-productive assets like bitcoin (and gold) and
| productive ones like companies.
|
| > Today the world's gold stock is about 170,000 metric
| tons. If all of this gold were melded together, it would
| form a cube of about 68 feet per side. (Picture it fitting
| comfortably within a baseball infield.) At $1,750 per ounce
| - gold's price as I write this - its value would be $9.6
| trillion. Call this cube pile A.
|
| > Let's now create a pile B costing an equal amount. For
| that, we could buy all U.S. cropland (400 million acres
| with output of about $200 billion annually), plus 16 Exxon
| Mobils (the world's most profitable company, one earning
| more than $40 billion annually). After these purchases, we
| would have about $1 trillion left over for walking-around
| money (no sense feeling strapped after this buying binge).
| Can you imagine an investor with $9.6 trillion selecting
| pile A over pile B?
|
| > ...
|
| > A century from now the 400 million acres of farmland will
| have produced staggering amounts of corn, wheat, cotton,
| and other crops - and will continue to produce that
| valuable bounty, _whatever the currency may be_. Exxon
| Mobil will probably have delivered trillions of dollars in
| dividends to its owners and will also hold assets worth
| many more trillions (and, remember, you get 16 Exxons). The
| 170,000 tons of gold will be unchanged in size and still
| incapable of producing anything. You can fondle the cube,
| but it will not respond.
|
| --Warren Buffett
| https://www.berkshirehathaway.com/letters/2011ltr.pdf
|
| (emphasis added in the final paragraph)
| guilamu wrote:
| You've made some excellent points here, mate, thanks.
| bunfunton wrote:
| Great comment, thanks
| UShouldBWorking wrote:
| Are you saying 95% of people are idiots? I'd always have put
| the figure at just 80 or so.
| mettamage wrote:
| From centralized exchanges the decentralized exchanges evolved
| since they share your criticism.
|
| The way I look at it: people create things, these things have
| certain effects. That's all there's to it. I don't mind that
| it's almost 100% against the idealism of Bitcoin, the fact that
| centralized exchanges were created and used is interesting in
| itself. Moreover, it's not necessarily incompatible with
| decentralization since trading Bitcoin on an exchange
| (centralized) is something else than exchanging Bitcoin via the
| blockchain (decentralized).
| WJW wrote:
| > since they lose 100% of the stuff that made BTC attractive in
| the first place
|
| Not so. They still allow speculation on BTC price volatility
| and "get rich quick" gambles is what drove most of Bitcoin
| growth in the past few years. If anything, the big exchanges
| make Bitcoin even more suitable for speculation than if it was
| on the blockchain, since you can trade way more if you don't
| have to wait several blocks for your trade to be confirmed.
| shawnz wrote:
| Making it easier to speculate should in theory decrease
| volatility and make market manipulation harder, since having
| more speculators should mean that the price is driven to its
| fair value more quickly.
| totalZero wrote:
| That might make sense if bitcoin were a commodity, but it's
| not. Speculation helps in markets where there are cross-
| market arbitrages available -- the stat-arb speculators can
| front-run the true arbitrageurs and keep markets in line
| with one another -- but that's not really the case with
| bitcoin.
| ta988 wrote:
| That's assuming that 1) there is a fair value for bitcoin
| 2) the market is able to assess amd direct bitcoon to that
| fair value (through the actions of its participants). I
| tend to believe that this economical " theory" is much more
| a belief/mantra than anything proved scientifically...
| WJW wrote:
| This gets back to the "gambling vs investing" debate we had
| on the front page yesterday. What is the fair value of
| bitcoin? It will never provide dividends or other types of
| future cashflows, so that aspect of its fair value is zero.
| The remaining part is purely speculative in that it is
| based on what other people will pay for it. It is not at
| all clear to me that having more (relatively uninformed)
| speculators will lead to less volatility for such an
| instrument.
| iso1210 wrote:
| > What is the fair value of bitcoin? It will never
| provide dividends or other types of future cashflows, so
| that aspect of its fair value is zero. The remaining part
| is purely speculative in that it is based on what other
| people will pay for it.
|
| Do Swiss Franks pay dividends or other types of
| cashflows? If I have 50,000 CHF in a box in my cupboard,
| what value is it beyond a small amount of fuel to burn?
| At some point I will hope someone (perhaps someone in
| Switzerland) will exchange something I want for those
| pieces of paper.
|
| On the other hand the Swiss Government could decide to
| make the money almost worthless, practically overnight
| (India did this with Rupees), by removing the main
| purpose of having the notes.
| UncleMeat wrote:
| And people who hold their wealth in cash are speculating,
| not investing.
| betterunix2 wrote:
| Actually the ultimate reason why a note has value is that
| it can be used to settle tax bills and other debts, so
| you do not have to "hope" that someone out there will
| take it -- the government behind the money will take it
| from anyone who owes taxes, which is almost everyone who
| lives or does business in the country.
| iso1210 wrote:
| Except not in the case of India, where the government
| wiped out the value of 500INR notes practically overnight
| jakear wrote:
| Hm, so what happens if a country issues some sort of
| currency in the form of loans/salaries/whatever but does
| not collect any tax (let's say they sell natural
| resources to foreign countries and use that money to
| maintain their printing presses). Would the currency be
| worth nothing?
| sershe wrote:
| I am not sure if taxes were used by GP for any particular
| reason; I think the key is that the governments actually
| forces other to use the currency for transactions. So, as
| long as the govt itself doesn't drastically change the
| rules, people wanting to sell their time now will take
| currency. There is no such mechanism for Bitcoin; it's
| really not that different from baseball cards, original
| paintings or smth like that in terms of being a store of
| value; based entirely on others' assumed future faith of
| its value (compared to any random cryptocurrency I can
| start tomorrow, or a print of the same painting/card).
| betterunix2 wrote:
| A few things:
|
| 1. You mentioned loans, and I mentioned debts. Debts
| matter at least as much as taxes as a source of demand
| for fiat currency, since the government can "reassign"
| the ownership of property if debts are not repaid and the
| government will always determine debt payments in terms
| of its fiat currency.
|
| 2. Suppose the money is only distributed to citizens in
| the form of salaries. What do they do with it? Why does
| anyone they do business with -- merchants, landlords,
| whoever -- want it? One of the reasons why taxes and debt
| laws work well is that they are _immediately_ relevant to
| almost everyone in a country (anyone who owns property
| owes property tax; anyone with a business loan must make
| their loan payments; etc.).
|
| 3. Suppose a country relies on resource wealth to
| stimulate demand for its currency. That country will
| compete in the global market for those resources and the
| demand for its currency, and thus the value of the
| currency, will fluctuate according to market forces. The
| price volatility would be a huge problem for the citizens
| of the country as they tried to use the currency in their
| daily lives.
|
| So while in theory, under very particular circumstances,
| such a thing would be possible, in practice it would
| probably not last long. Volatility, weird distortions in
| demand, and other issues would render the currency hard
| to use and reduce its value in the local market.
| chrischen wrote:
| Crypto is required to pay extortionists (whether you
| agree it is right or not is irrelevant).
| mcguire wrote:
| One hopes that you do not regard 50,000 CHF in a box in
| your cupboard an _investment_. I 've got about $200 in a
| drawer in the other room for unexpected events---ones
| that don't involve any infrastructure at all.
|
| My actual investments are in economically productive
| assets.
| albntomat0 wrote:
| > Do Swiss Franks pay dividends or other types of
| cashflows?
|
| There is consistent demand by the Swiss government, in
| the form of tax collection.
| dmitriid wrote:
| > If I have 50,000 CHF in a box in my cupboard, what
| value is it beyond a small amount of fuel to burn?
|
| You are so close to understanding the true value of
| bitcoin.
| [deleted]
| andresp wrote:
| A sub optimal way of producing thermal energy (at least
| in for the miners)?
| BurningFrog wrote:
| > _The remaining part is purely speculative in that it is
| based on what other people will pay for it._
|
| This is of course true, but it's also true for oil,
| buildings, pork bellies, and any other kind of property.
| tiku wrote:
| One of the values of bitcoin is the price miners get for
| it. If they lose money on selling their newly minted
| bitcoins they won't sell. So it's related to power
| prices, the difficulty of mining a new coin.
| betterunix2 wrote:
| That sounds like a restatement of the "labor theory of
| value" which makes no real sense, as it assumes that
| "someone" is always willing to buy. Why should anyone be
| motivated to buy Bitcoin, beyond the classic "great fool
| theory" trap?
| shawnz wrote:
| Bitcoin isn't a stock. Most kinds of assets don't provide
| dividends or other cashflows -- that is certainly not the
| only determiner of the value of an asset. It would indeed
| be a bad idea to construct an investment portfolio out of
| only Bitcoins and no stocks, but that doesn't mean it is
| without value (for example, as a monetary technology or
| an inflation hedge)
|
| > It is not at all clear to me that having more
| (relatively uninformed) speculators will lead to less
| volatility for such an instrument.
|
| I am not sure how we can judge the informedness of the
| speculators or what we are comparing them against. But,
| each additional speculator improves the informedness of
| the market overall.
| tootie wrote:
| Commodities are not stocks but they have intrinsic value.
| The value of oil or chickens is based on demand for their
| consumption.
| mcguire wrote:
| Assets similar to bitcoin are somewhat rare on the
| ground. Art, antiquities, maybe a few other things.
| (Precious metals are typically useful for other things.)
| Few people regard those assets as useful investments, in
| anything other than a diversification sense. _No one_
| regards them as economically productive.
| shawnz wrote:
| I completely agree with these statements, except I think
| the intrinsic value of precious metals is exaggerated and
| Bitcoin also has functional value as a monetary
| technology (not generally in an important way for most
| first-worlders though).
| WJW wrote:
| > each additional speculator improves the informedness of
| the market overall
|
| I don't think that can be true. Leaving bitcoin aside for
| a moment, if a new speculator comes into the stock market
| who truly believes (perhaps due to misleading marketing)
| that "stocks only go up". This is clearly not the case
| from an objective standpoint. How would the entrance of
| such a speculator improve the informedness of the market
| as a whole?
| bitdizzy wrote:
| Garbage in garbage out applies to markets too.
| riffraff wrote:
| as it's been pointed out by many people in many circumstances,
| the whole cryptocurrency story so far has been a progressive
| reinvention of the modern financial system, including many of
| the intermediary steps.
| rualca wrote:
| I wouldn't go as far as calling it a reinvention of the
| modern financial system, but I would call it a reinvention of
| the Dutch tulip mania[1], with the notable exception that
| tulips do have some tangible value.
|
| https://en.wikipedia.org/wiki/Tulip_mania
| SamReidHughes wrote:
| The other _obvious_ exception is that bitcoins don't self-
| replicate.
| Animats wrote:
| Tether, though...
| EVa5I7bHFq9mnYK wrote:
| There must be an entry point. After you bought you BTC, you can
| withdraw it, and use it to pay for things, store privately etc.
| anonisko wrote:
| A true cypherpunk would say that everyone should just start
| earning bitcoin directly to enter.
| EVa5I7bHFq9mnYK wrote:
| True) I hired developers for Bitcoin directly and through
| Fiverr - they used to have a Bitcoin payment option.
| codehalo wrote:
| That is not possible without some kind of bootstrapping
| mechanism.
| anonisko wrote:
| I suppose you mean it's not possible without some sense
| of the value in relation to existing value networks? And
| this is the bootstrapping that fiat exchanges provide?
| gurtyui wrote:
| If you want to go to the Amazon jungle, you will still need to
| pass through a (centralized) airport.
| ravenstine wrote:
| > transactions don't even go on the blockchain
|
| What are you talking about? When you purchase coins on
| Coinbase, they go into a wallet that you can easily deposit to
| through another means or withdraw to another wallet. This is
| the same with Binance, Kraken, CashApp, and so on. Exceptions
| would be Paypal or Rob-in-'hood where they have total custody,
| which has advantages if the user doesn't care about actually
| owning the coins themselves.
|
| Don't like the centralization of Coinbase? _Then just don 't
| use it._ There's plenty of other options for purchasing
| bitcoins. Buying them P2P is easy as hell. Local Coin Swap and
| Local Bitcoins allow you to buy crypto directly from
| individuals with an escrow system.
|
| By the way, not everyone is interested in the same advantages
| of Bitcoin. One of the reasons Bitcoin has been on he rise the
| last year is that it has far greater potential than a savings
| account to grow in value and, unlike gold or silver, doesn't
| take up physical space. Not everyone cares about
| decentralization or is averse to risk.
| paulryanrogers wrote:
| > One of the reasons Bitcoin has been on he rise the last
| year is that it has far greater potential than a savings
| account to grow in value and, unlike gold or silver, doesn't
| take up physical space.
|
| Its potential may be offset by its environmental impact and
| lack of any fundamental value.
| ravenstine wrote:
| I'm not here to debate that, but my point is that not
| everyone is obsessed with decentraliztion... they just want
| their money to grow fast, just as most people don't buy
| stocks with the primary intention to own a piece of a
| business; they buy stocks because they want to make money.
| mensetmanusman wrote:
| " Less than 2% of the anonymous ownership accounts that can be
| tracked on Bitcoin's blockchain control 95% of the digital asset,
| according to researcher Flipside Crypto."
|
| It's kind of ironic that BTC pollutes more than any prior
| monetary invention while simultaneously having higher levels of
| internal income inequality.
| arcticbull wrote:
| It's all around the worst one yet.
|
| If your transaction counterparty is within 1250 miles of your
| house it takes less energy to simply drive there in a Tesla
| with a brick of gold.
|
| It's also funny because I suspect the overwhelming majority of
| those accounts simply lost their keys.
| rsp1984 wrote:
| _"It's a money network," Winklevoss said. "What happens when you
| put an economic incentive around that network? That's possibly
| the most effective network in the world."_
|
| How in the world can you call Bitcoin a "money network"? Unless
| I'm missing something obvious there's no more network effect to
| it than to any other popular currency or security.
| chrisco255 wrote:
| You're correct on Bitcoin's network effect being currently less
| than that of existing popular fiat currencies. The currency
| market, is of course, the most actively traded market in the
| world. The FOREX trades over $7 trillion per day, and the
| market is worth over $2.4 quadrillion.
|
| But yes, Bitcoin has already eclipsed all but a handful of
| stocks with a market cap clocking in at $800B-$1T, a daily
| volume of $50B+ and its more liquid than any stock since it
| trades 24/7 and can be remitted without intermediaries.
| [deleted]
| samstave wrote:
| Whats the networth of the W brothers (the ones that Zuck stole FB
| from?)
| b1daly wrote:
| This article is an example of the pure propaganda that
| 'mainstream financial media' participates in on-the-regular. Why
| that is I don't know. Symbiotic business interests I guess.
|
| It's not that the information is incorrect. It probably is and it
| does tell us something about some of the big players around
| Coinbase.
|
| But the whole bitcoin 'ecosystem' is essentially a collective
| criminal organization, with some players being closer to the
| dirty parts than others. (I'm leaving out everyday holders of
| bitcoin, just talking about insider types.) These big Coinbase
| players might not 'touch the poo' directly, but their hands still
| get stinky.
|
| The price action in bitcoin is determined across a network of
| exchanges, most of which do not use real dollars (or other govt
| currency). They use crypto only for trading, including the fake
| 'stable-coin' tether.
|
| Tether (the company who issues the currency tether) has been
| shown definitively to be running a scam and are completely
| dishonest.) They have issued $35Billion worth of their fake
| dollars. Until recently they were issuing on the order of $1B per
| week!
|
| Tether is a sister company to the exchange Bitfinex with the same
| owners and management. So essentially the same company. They just
| signed an agreement with the New York Attorney General where they
| paid a fine of $18.5M (notice difference in scale). The agreement
| spells out _exactly_ how they have been scamming people. This is
| based on information coming from the company itself. This is not
| FUD, just FACT. (interestingly since they signed this agreement
| ~10 days ago, they stopped issuing tether.)
|
| One of the central players in this ongoing criminal operation who
| has been taken out is Crypto Capital Corp. They ran a shadow
| banking system for many of the big exchanges, including Bitfinex
| and Binance. The Feds seized $850M from CCC for money laundering,
| which precipitated a crisis for these entities and intensified
| the criminal activity of the many industry insiders connected
| through this shadow bank.
|
| My guess is that Tether issued $35B in fake USDT (tether) almost
| exclusively without dollar collateral backing. (the original
| premise of tether was each would only be issued on receipt of a
| true USD by tether, and therefor each USDT was pegged to a USD,
| the peg holds for now but the dollar backing is not there, that's
| another story.)
|
| Most of this $35B was issued over the last year when we have seen
| a huge rise in bitcoin price. The tether currency only has _one_
| purpose, to buy cryptocurrency. So this is a huge amount of
| liquidity introduced into the market. (Compare to the hype around
| Tesla 's $1.5B bitcoin purchase.)
|
| It is the price appreciation that drives this whole market,
| including the business of Coinbase, even though they do not deal
| with tether.
|
| The OP article mentions _none_ of this! Sure, it reveals some
| insiders, perhaps on the more legit side, but ignores the real
| engine of this speculative bubble /fraud.
|
| It has the effect of 'white-washing' this dirty game.
|
| It's really gross.
| [deleted]
| geswit2x wrote:
| please, can you post something that we don't have to pay in order
| to read? thanks
| randomNumber7 wrote:
| Don't know why you are downvoted. I think it's super
| annoying...
| greenyoda wrote:
| Please read the HN FAQ:
| https://news.ycombinator.com/newsfaq.html
|
| > Are paywalls ok?
|
| > It's ok to post stories from sites with paywalls that have
| workarounds.
|
| > In comments, it's ok to ask how to read an article and to
| help other users do so. But please don't post complaints about
| paywalls. Those are off topic.
|
| More details:
|
| https://news.ycombinator.com/item?id=10178989
|
| You can get around Bloomberg's free article limit by clearing
| their cookies (or using a browser extension like uMatrix that
| automatically blocks them).
|
| Their articles are also readable if you submit them to an
| archive site. For example, someone posted this link in another
| comment: https://archive.is/AqtRg
| kemonocode wrote:
| I agree, there needs to be a ruling about paywalled articles
| already. At the very least, tagging them properly (so people
| may ignore them at their leisure) or also putting an archive
| link in the comments.
| samstave wrote:
| Assuming the Winklvoss Twins ONLY kept the initial 11,000 BTC
| they purchased - Those coins are worth 497MM today.
| aphextron wrote:
| Say what you will about the technology, but the Bitcoin community
| attracts the most unsavory, scandalous people imaginable. It
| truly is a wretched hive of scum and villainy. Everything even
| tangentially related to it instantly becomes a source of scams,
| illegal activity, and just general shadiness. It's what has
| always turned me off of blockchain technology in general. I'm
| sure these same people exist in the fiat financial world as well,
| but it just has a lawless, wild west, dog eat dog atmosphere that
| is so off putting.
| 1996 wrote:
| > I'm sure these same people exist in the fiat financial world
| as well, but it just has a lawless, wild west, dog eat dog
| atmosphere that is so off putting.
|
| Actually, it's far worse in the fiat financial world.
| loceng wrote:
| So will there be an investigation by the SEC for price
| manipulation relating to how inconveniently Coinbase was
| unaccessible multiple times for fairly long periods at different
| times the price of Bitcoin started to skyrocket?
| gruez wrote:
| robinhood (among other brokers) goes down all the time during
| periods of high trading activity. That doesn't mean there's
| anything malicious going on.
| Triv888 wrote:
| You can only wish... The same thing happens to stock brokers
| and they don't get investigated, most of the time.
| mrfinn wrote:
| Blockchain technology is doomed, and somebody will be,
| eventually, the last link of the ponzi scheme.
| superbcarrot wrote:
| I don't get why people's thinking swings to these wild
| extremes. Why does it have to be either a societal disruptor
| that changes everything or a doomed ponzi scheme? Can't it be
| something like "oh we tried to have cool internet money, turned
| out that it's not that great, some people are still into it I
| guess".
| xirbeosbwo1234 wrote:
| Because it is so fantastically monumentally brain-meltingly
| bad. When a casino uses as much electricity as entire
| countries, it deserves my hatred rather than just not
| deserving my love.
| TheButlerian wrote:
| Because they are dumb nocoiners.
| mrfinn wrote:
| It becomes a Ponzi scheme the moment you realize that the
| idea is intrinsically broken, but still you keep shilling it
| and making grow the value exponentially, (value that somebody
| has to pay). BTW, flagged, really mods??
| tiku wrote:
| When does a Ponzi scheme stop being a Ponzi scheme?
| totalZero wrote:
| This is a really, truly weird way to defend Bitcoin,
| whose claim to fame is that its only value comes from its
| uptake. The argument goes, "governments can fiat money,
| so why can't we?"
|
| There is no unique creation of value anywhere in the
| Bitcoin life cycle. Any liquidity or anonymity
| externality that doesn't equally apply to USD is probably
| accruable only by criminals and traffickers.
|
| The transactions are slow and costly, and there's no
| guarantee that some governmental research agency hasn't
| already broken the cryptographic underpinnings.
| africanboy wrote:
| because there is no such thing as "cool invented money" it is
| either useful for society or it is a scam.
| thetanil wrote:
| there are a lot of people in the "not that great" and "still
| into it I guess" camps. Those just don't make headlines.
| Also, some morons can only read headlines. Don't worry, the
| world is not as idiotic as the headline writers and readers.
| jariel wrote:
| 'into it' for what reason? That's where the Ponzi part comes
| from.
| ur-whale wrote:
| And all the tin-foil wearing weirdos who had been hollering
| about it from their mum's basement will be vindicated.
|
| That will be quite a day!
| mrfinn wrote:
| Actually some of us are really interested in cryptocurrencies
| as tool to liberate people from a corrupt system, and we
| leaved our mum's basement a long time ago.
| Rapzid wrote:
| Perhaps the idea of "pure decentralization" doesn't exist; only
| partial realizations of it.
|
| If you look at Bitcoin and Ethereum you find concentrations of
| power, information, and etc at many levels; centralization. Even
| at the technical level the solution to controlling change is
| often to have minority steering groups whose membership
| necessarily suggests a concentration of power enabling them to
| exert influence.
| ketamine__ wrote:
| Taking that a bit further many startups have raised a
| traditional round before an ICO. Since ICO's are so popular I
| think one could argue that they don't need to do this. Are they
| loyal to the VC's or the token holders?
| gnrlst wrote:
| Remember when BTC used to be fun and exciting? Stupid projects
| being created, tipping widespread all over the internet. It was
| created to be a "peer-to-peer electronic cash system" (quoting
| from the whitepaper title)... oh how far it has strayed.
| kolinko wrote:
| Regulation killed it - since SEC is watching more closely you
| either need a legal team, or you need to be very adventurous to
| build stuff like bitcoin tip bot on reddit :/
| ur-whale wrote:
| I agree, except for the fact that the exact same things can be
| said of _anything_ that becomes wildly successful.
| Sargos wrote:
| >Remember when BTC used to be fun and exciting? Stupid projects
| being created, tipping widespread all over the internet.
|
| All of this moved over to Ethereum long ago but those outside
| of the crypto space might not know that. Thousands of hackers
| have created little neat experiments and projects for others to
| use and build on and more are released everyday.
|
| Some of my favorites are https://dontbuymeme.com/,
| https://aavegotchi.com/, and https://quadraticvote.co/. There's
| too many to list (like the internet itself) but a lot of
| communities for specialized topics have formed such as art
| people flocking to NFTs, meme lovers creating self funding and
| self organized communities, and lots of cool governance tools
| for voting and organizations like https://daohaus.club/,
| https://colony.io/, and https://aragon.org/.
|
| It really does feel like the early internet and I can barely
| keep up with all of the cool stuff being shipped.
| leppr wrote:
| Right, and it's not just neat little experiments. There
| already is big money on Ethereum's DeFi: billions lended,
| transacted between assets, leverage longs/shorts taken.
|
| Add to that experimental unpegged stablecoin projects[1], and
| you realize the dream of a "P2P electronic cash system" is
| alive and well. It's just being worked on by different groups
| than originally (because if you own a big bitcoin stash now,
| it's hard to resist the temptation of pushing the SoV/ponzi
| narrative).
|
| [1]: https://debaseonomics.io/, https://reflexer.finance/
| casi wrote:
| https://mia.bet/ is one i like, a home made site where you
| bet on a marble run race with the randomness generated by
| their pet hamster. makes me smile.
|
| i'll also add in https://clr.fund/ as its relevant to the
| bigger question of "how do we fund open source public goods"
| that might be relevant to hackernews readers.
| choclatecheese wrote:
| mia.bet?? omg is this for real? lol real randomness on
| blockchain generated by a hamster
| ZeroMinx wrote:
| Most of this also applies after a s/BTC/WWW/
| barbegal wrote:
| Yes I remember when you could send Bitcoins and your
| transaction was practically guaranteed to get into the next
| block. I had fun solving puzzles created using Bitcoin scripts.
| If you could solve the puzzle you could win some Bitcoins.
| Transaction fees were so low as to be irrelevant and you could
| send small tips to anyone you wanted, buy beers, gift it to
| strangers to try out...
|
| But even then you could see that Bitcoin wouldn't scale. Most
| people couldn't run full nodes, block sizes were getting bigger
| and bigger. Bitcoin worked great when you had a few hundred
| thousand people using it but with 10s of millions it doesn't
| work well.
| tromp wrote:
| Running a fully verifying node doesn't require that much
| space, since you can prune away older blocks once verified
| (if you're fine with not being able to seed other nodes). It
| does take a fair amount of time to download so many GB of
| history.
| CyberDildonics wrote:
| This is not true in any sense. After 11 years of use, a $10
| vps can download the entire chain in under an hour and a
| half. A fast cable modem connection can do it in under
| three hours.
|
| Call of Duty: Modern Warfare is 231 GB, the bitcoin chain
| is 381 GB.
|
| Call of Duty + Red Dead Redemption 2 = bitcoin's entire
| chain.
|
| This is about $6 USD of hard drive space. The throughput of
| bitcoin is about 1.5 -kilobytes- per second. At that speed
| reddit.com would take 36 minutes to load.
| tromp wrote:
| You need to verify the history as well and continually
| update the UTXO set. That takes a lot more time,
| especially with a spinning hard disk, since the UTXO
| updates are not particularly sequential.
| CyberDildonics wrote:
| First, that isn't what you actually said.
|
| Also no it doesn't. It takes a fraction of a second on a
| single core for each block. It's 900KB for a full block.
| The only reason it would take a long time is a particular
| client using CPUs extremely inefficiently and leaving
| them idle most of the time.
| vbezhenar wrote:
| > Most people couldn't run full nodes
|
| Can you elaborate on that? I checked few years ago and it was
| possible to run full node. What would prevent me from running
| full node right now?
| barbegal wrote:
| Maybe I should say didn't rather than couldn't. Everyone
| can rent a server for a few dollars a month to run a node.
| Most people home laptops are not suited to running a full
| node as they either have to be always on or are spending a
| lot of time validating blocks every time you power them on
| to catch up.
| ur-whale wrote:
| https://archive.is/AqtRg
| ExcavateGrandMa wrote:
| money > bitcoin ... wake up before the bitcoin excavates you :)
| ur-whale wrote:
| Any article that uses the sentence "mostly men" in the first
| paragraph is highly likely not worth reading.
| gurtyui wrote:
| According to Financial Times it's a good thing crypto is mostly
| men, since it's such an obvious scam:
|
| > _Most women aren't as into crypto as men and that's OK. It's
| actually good! Cryptocurrencies consume huge amounts of energy,
| enable criminality, often lack security, and generally just don
| 't work very well._
|
| > _But let 's not encourage other women to throw their money
| away on nonsense. And let's not think that just because a lot
| of men are doing something, we should do be doing it too._
|
| https://www.ft.com/content/77f34d67-b797-3359-a89d-f9447ca40...
| CryptoPunk wrote:
| I agree. It goes without saying that most of the capital is
| owned by men. In which industry is that not the case?
|
| The social commentary angle can't justify that line either:
| Bitcoin is a pseudonynous digital currency, that started
| trading at $0.10, and required nothing more than having a basic
| windows machine, and downloading the node software, to hold
| from the start. Very early on, downloading the standard wallet
| software was also all it took to mine bitcoin. If mostly men
| own it, it's because mostly men were interested in the concept
| early on.
|
| In any case, despite containing that line, this was a good
| article and worth reading.
| darawk wrote:
| I think the point is that the article feels a need to highly
| this, as though it is relevant. Primarily because they are
| trying to narrativize it in a certain way.
| 55555 wrote:
| These says, if you write "men" instead of "mostly men", you get
| attacked my SJWs. My favorite form is when they write "men (and
| they are almost entirely men)."
|
| But as is becoming clear to many, you cant please everyone all
| of the time, and, especially these days, there are some people
| you cant please any of the time.
|
| What phrasing would you prefer? "Humans" or just "men"?
| kolinko wrote:
| "People". You shouldn't use gender, race, religion or
| nationality to describe a group of people unless it is
| somehow important to the story.
|
| Otherwise you end up propagating stereotypes.
| shawnz wrote:
| I think "people" would be the typical language to use in such
| a situation.
| dmingod666 wrote:
| If someone cannot think about a topic without classifying the
| genitals of the discussed people irrespective of what they
| are talking about, you'd probably not be wrong to take notice
| of that.
|
| Not that it matters, but, expecting the whole world to share
| the same perversion is a bit too much..
| random5634 wrote:
| What is the fixation on "genitals" here? This comes up
| surprisingly often in this type of conversation.
|
| "Hey guys, anyone want to get coffee?"
|
| "Sure"
|
| Random SJW: "why are you focused on genitals? What a weird
| perversion"
|
| Everyone else: "Huh?"
|
| Is this a projection thing? Half the time the lazy pronoun
| use appears to be the exact opposite of this claim - the
| writer hasn't stopped to think and classify readers by
| their genitals.
| dmingod666 wrote:
| You are repeating my point.. My point was, why do you
| want to attribute gender to things where it isn't
| directly relevant..
|
| How does the author know the gender breakdown of a
| currency where we can't even figure out who the person
| behind the bitcoin address is...
| viraptor wrote:
| > How does the author know the gender breakdown of a
| currency where we can't even figure out who the person
| behind the bitcoin address is...
|
| A large number of whales holding BTC is known / very
| public and vocal - as the article itself discusses. You
| can also do a survey of Bitcoin related conferences. You
| can look at large datasets like the public list of MtGox
| debts. At this point you'd need some good supporting data
| to claim BTC holders and traders are not a male-dominated
| group.
| dmingod666 wrote:
| If there is a claim that an anonymous currency is owned
| in major part by a certain gender the burden of proof
| lies on the people making a claim..
|
| I don't think anyone can actually prove these numbers..
|
| If I say 70% of cash is held by group 'x'. prove me
| wrong, you can't. No one is going to be able to do that.
|
| Let me know if you have a link to MtGox sharing gender
| breakdown of their owners..
| wayneftw wrote:
| > I don't think anyone can actually prove these numbers..
|
| Nobody is making a court case out of it, except for you.
|
| Everybody else is just using their common perception,
| that it is indeed mostly men holding bitcoins because
| it's mostly men talking about it and it's commonly known
| that mostly men are into computer technology.
|
| Let me know if you can't justify a correlation between
| those things and I'll help you "read the room" better.
|
| Anyway, the article says that "Coinbase Global Inc." is
| mostly men, not holders of Bitcoin. Without even looking
| I can tell you that's most likely 100% accurate.
| dmingod666 wrote:
| "Men own most bitcoins"
|
| "Mostly men are into computer technology."
|
| Where exactly in the bitcoin purchase or process the
| gender of a person relevant or disclosed? Why do people
| try to drag gender into things where it has zero
| relevance.
|
| I'm not trying to be a lawyer, the point is, that this
| argument has as much logic as "Aquarians are better
| swimmers." You can't prove or disprove it.. either way,
| it's irrelevant..
| wayneftw wrote:
| If someone said "The remarkably small circle of mostly
| _hair stylists_ who control bitcoin " would you have
| responded so many times? No, there's something about
| gender here that's got you incensed. I'm not trying to
| sound flippant, but I think there's more to this than
| genitals and the amount of relevance that genitals or
| gender has to the story.
|
| First though, I think you're confusing what was said. The
| starting sentence of the article is:
|
| > Coinbase Global Inc.'s filing to become a publicly-
| traded company provides a glimpse into the remarkably
| small circle of mostly men who command the incredibly
| lucrative digital landscape.
|
| That's not a statement about "men own most bitcoins" it's
| saying that Coinbase Global is run mostly by men. _This_
| is easily proven. You can look right here - 5 out of 7 of
| their executive team are men and 7 out of 9 on their
| board are also men - https://www.coinbase.com/about
|
| So someone responded about that first sentence saying
| 'Any article that uses the sentence "mostly men" in the
| first paragraph is highly likely not worth reading'. You
| agreed with that sentiment, pointing out why - you think
| mentioning gender is irrelevant and furthermore it is a
| "perversion" for someone to do so. (Would it be a
| perversion if they said "hair stylists"?)
|
| Here's why I think you're wrong on that point though.
| You're strictly equating "gender" and "genitals" as if
| they're synonyms. They're not. If you think that's true,
| try an experiment: Ask random people the first thing that
| comes to their mind when you say the word "men" or the
| word "women" to them. I'll bet you money that the vast,
| vast majority of people will not just say "penises" or
| "vaginas". They'll say so many other things because those
| words convey so much more than just genitalia.
|
| In the news they constantly mention the gender of people,
| especially if the group of people they're discussing are
| all or even mostly one gender. That's because it helps
| listeners picture what's happening in their mind.
| Moreover, reversed gender roles are absolutely
| interesting to people. For instance - most criminals are
| men [0], so if a group of women robbed a bank you can
| rest assured that the news would absolutely say "A group
| of women robbed a bank" and also that it would be so
| interesting to people that they'd make a movie about it.
| Even if men robbed the bank, they would say "a group of
| men" because if they said "a group of people robbed a
| bank" people would want to know - so if it's a mixed
| group the news will say "two men and a woman robbed a
| bank today."
|
| Why are most men criminals though? It's probably because
| men are just generally more aggressive than women. That
| fact is just one of the many that will occur to people
| when they hear about a group of people doing something.
| Genitalia is the furthest thing from their mind.
|
| In the end, I don't know exactly why Matthew Leising, the
| author of this article, even mentioned that it's mostly
| men that run Coinbase Global. I know for a fact that most
| people would not be bothered at all by this tidbit of
| information being mentioned though. I'm not. I don't even
| care about bitcoin and I'm not even sure why I bothered
| to read these comments. One thing I am concerned about
| though is how people are squaring up to fight over these
| types of things. Why do you have such a strong reaction
| to someone mentioning the possible/probable gender ratio
| of a group of people? Perhaps the subject of societies
| treatment and recognition of gender in general is
| something close to your heart? I don't know - but I don't
| want the world fighting over this too so I'd like to help
| if I can.
|
| [0] https://www.google.com/search?q=gender+percentage+of+
| crimina...
| random5634 wrote:
| "Hey guys, want to get coffee" - is a historically common
| (and yes, now bad way) of asking if a group of folks, of
| any gender, want to get coffee.
|
| The insistence that someone is focusing on genital's and
| have a pervasion when asking this really does seem like a
| projection on the part of the folks making that claim,
| and I have noticed the genitals things come up over and
| over now in this context - it seriously is WEIRD! Please
| read up on projection.
|
| Many of us are married, with kids, and focusing on the
| genitals of work colleagues is the LAST thing on our
| minds.
|
| I've broadened it in the past, hey guys and girls or hey
| guys and women - all less than ideal in my view, girls
| doesn't have same connotations as guys, and women or
| ladies feels awkward. Hey people works well in my view.
| But when a women says to me, hey guys, want to get coffee
| - I don't freak out on them with this type of focus on
| genitals / perversion language. I just say, sounds great
| - 5 minutes? And away we go very happily to chat about
| whatever issue has come up.
| moistly wrote:
| Are you telling us that you've never heard a woman say to
| her group of female friends "Hey guys, wanna xyz?"
|
| It's 2021. "Guys" has been gender neutral since basically
| forever and a day. It was so in my schools in the
| 70s/80s, and by my mother's recollection, the same back
| in her school days.
|
| And it pretty much has to be so: we lack a good
| alternative second person plural.
|
| Note though that "guy" (singular) is gendered.
| gfody wrote:
| btw "gaz" is a perfectly harmless way to address a mixed
| crowd - the men hear "guys" and the women hear "gals" and
| not even the worst griefer would pick on a speech
| impediment
| 177tcca wrote:
| Texans had "y'all" right the entire time.
| random5634 wrote:
| Haha. Doesn't work where I am as southern accents are
| seen as racist in a way - and also I'm not southern so
| would be weird on that level - but I like it if you were
| in the south!
| rokhayakebe wrote:
| "This type of cancer affects mostly men."
|
| "Women make the majority of the school's Computer Science
| enrollment which used to be mostly men."
| howdydoo wrote:
| That must mean cancer is sexist. No wonder people hate it so
| much.
| iamacyborg wrote:
| Yeah, testicular cancer is real sexist
| jariel wrote:
| It's factual, noteworthy and reasonable in the context.
| ALittleLight wrote:
| Why? Would you feel differently about coinbase if it's
| leadership were evenly divided between men and women, or
| largely women?
| jariel wrote:
| No. Your attempt to project hyperbole into what I 'feel' is
| not rhetoric.
|
| If it's a small group of heretofore unknown people with a
| major stake in a new, exotic and opaque, 1 Trillion dollar
| asset pool, then describing them as 'all men' is perfectly
| reasonable if they are. Just as if they were all American.
| It's relevant because they are obvious characteristics of
| the group and not a random outcome.
|
| If there was some women in the group then it wouldn't have
| been notable.
|
| This is not SJW journalism it's just journalism.
| imbnwa wrote:
| Oh how the turn tables
| ALittleLight wrote:
| It seems to me that if a fact is informative then the
| opposite of that fact would be too. For example, the
| article says that verified users jumped 34%. That fact
| tells us coinbase is growing and at what pace. If the
| opposite were true, and users were declining, that would
| tell us coinbase and maybe bitcoin were in trouble.
|
| I don't see what the most common gender among the
| leadership team tells us. What does it matter if they are
| mostly, partly, or entirely men or women? This article is
| written in Bloomberg, the four founders of Bloomberg plus
| their chairmen are all men[1] - does that matter? If I
| were to put on my "just journalism" hat, maybe I'd think
| it says something when organizations led entirely by men
| criticize organizations partly led by women for their
| social justice bona fides... Or, maybe I'd think that
| most executives are men, most people in tech are men,
| most people in crypto are men, so it's really not that
| surprising or informative that most of coinbase's
| leadership are men. Or, maybe it does matter for some
| reason, but the journalist should explain that reason
| rather than just drop the fact and imply it means
| something without explanation.
|
| 1 - https://en.m.wikipedia.org/wiki/Bloomberg_L.P.
| ALittleLight wrote:
| "Mafia" seems a strange and prejudicial word to use here.
|
| "Less than 2% of the anonymous ownership accounts that can be
| tracked on Bitcoin's blockchain control 95% of the digital asset"
| - at first I thought this was really astonishing. Now, I'm not so
| sure. My first interpretation was that 2% of bitcoiners have 95%
| of the bitcoin - but now I wonder how many addresses a typical
| person has. e.g. If I create an address every time someone buys
| illegal drugs from me over the 5 years I sell them on the
| darknet, and later coalesce all my earnings into some address,
| does that mean that my X empty addresses are counted in the 98%
| of have-nots and my one coalesced address in the 2% of haves?
|
| Depending on how many addresses people typically use, and given
| the multi-year history of bitcoin, it actually seems somewhere
| between not surprising and incomprehensible to me. Like, I guess
| that's a percentage it could be, but I don't know how to
| interpret it. I think a better news article would provide context
| on stats like this so the reader could understand rather than
| just leaving the reader to figure out the meaning for themselves.
| Izkata wrote:
| > My first interpretation was that 2% of bitcoiners have 95% of
| the bitcoin
|
| Consider how much was probably lost in the early days, from
| dead hard drives and such. For one specific example, bitcoin
| creator Satoshi Nakamoto appears to have ~1 million bitcoin
| sitting untouched [0] - that alone seems to be ~5% of all
| existing bitcoin [1] owned by one person, with an estimated
| 11-16% more just "lost" [also 1].
|
| [0] https://decrypt.co/34810/how-many-bitcoin-does-its-
| inventor-...
|
| [1] https://www.buybitcoinworldwide.com/how-many-bitcoins-are-
| th...
| agumonkey wrote:
| A recent example of lost recovery https://old.reddit.com/r/Bi
| tcoin/comments/lto0rt/found_an_ol...
| xirbeosbwo1234 wrote:
| I supposedly own about 900 Bitcoins. I was given them for free
| all the way back in 2010 and promptly deleted the "wallet" once
| I realized the technology was unworkable.
|
| A naive analysis would completely miss that.
| cnKLP wrote:
| It is a common colloquial use of the word in many languages.
| Cambridge dictionary:
|
| "a close group of people who are involved in similar activities
| and who help and protect each other, sometimes to the
| disadvantage of others"
| leto_ii wrote:
| I'm not sure about this, but does every person using an
| exchange get their own address?
|
| My impression was that they don't and that a lot of
| transactions are actually settled within the exchange using
| good ol' relational databases and not the blockchain.
|
| If that's the case, then all of these people will get lumped
| into just a few exchange controlled adresses, which will give
| an exaggerated impression of concentration.
| KirillPanov wrote:
| > I'm not sure about this, but does every person using an
| exchange get their own address?
|
| Definitely not. Exchanges that aren't stupid keep the vast
| majority of their funds in cold storage, which is held in a
| small number of addresses.
|
| Most people store their bitcoin on exchanges, even though
| that's a pretty bad idea. Not your keys not your coins.
|
| The article is massively misleading. It should say "95% of
| bitcoin is controlled by a small number of entities, most of
| which are exchanges". That's still not good, but at least
| it's not deceptive.
| aasasd wrote:
| > _Exchanges that aren 't stupid keep the vast majority of
| their funds in cold storage_
|
| That sounds dumb on their part, as that money isn't doing
| work that it could. Perhaps they should invest it in the
| meanwhile. But since it's users' money, maybe set up a
| provision that only a part of the funds is invested, and
| the rest stay put, to give them back to the users on
| demand. Most people don't regularly take out all their
| coins at once, so the exchange won't need to have them all
| on hand, most of the time.
| leto_ii wrote:
| > The article is massively misleading. It should say "95%
| of bitcoin is controlled by a small number of entities,
| most of which are exchanges".
|
| Yeah, that's exactly what I felt as well. Thanks for
| clarifying.
| dukodk wrote:
| I think it's mostly from using temporary accounts to hide
| transactions. When you can "open" an account digitally without
| limits, this seems like the inevitable. They should look at
| actively traded accounts. Fast search shows ~1M active out of
| 460M total.
| _Microft wrote:
| They might be alluding to the "Paypal Mafia".
|
| https://en.wikipedia.org/wiki/PayPal_Mafia
| bombadilo wrote:
| I've been reading hacker news for years and I can't recall any
| piece of technology that seems to attract such vitriol and
| disdain from the community here.
|
| Certain bitcoin criticisms are understandable, but painting the
| block chain and the whole crypto industry with a broad brush of
| 'scam', 'shady', 'useless' is just down right moronic and
| embarrassing.
|
| Many of you claim to be technologists that leverage the power of
| technology to benefit humanity. Yet you can't plainly see how
| various projects in the space like ethereum, nano, chain link,
| cardano etc. have useful applications that will change the
| landscape of finance and economics forever.
|
| Painfully cynical bunch you lot are.
| kemonocode wrote:
| I won't say much about the article as it's a topic that has been
| discussed plenty of times before (The merits and faults of
| Bitcoin) with often inflammatory results, but I will definitively
| say it's pretty easy and rather intellectually dishonest to
| attack it only whenever there's a dramatic price swing. Where
| were all these articles during all those price lull periods?
|
| Also, if we're pointing fingers, the influence Coinbase has on
| Bitcoin is insignificant compared to the Chinese mining
| conglomerates. The US is not the rest of the world.
| Grim-444 wrote:
| What price lulls?
|
| Before 2017 the price of Bitcoin was stable as it wasn't worth
| anything.
|
| From 2017 to 2021 the price of bitcoin has changed every year
| by: 1,300%, 71%, 75%, 328%
|
| Compared to the DJIA, which over the same years changed every
| year by: 25%, 8%, 21%, 11%
|
| In the last four years, two of those years have had price
| changes in the hundreds of percent, and the other two years the
| change was still 300% the greatest change in the DJIA across
| any of those four years.
| Judgmentality wrote:
| > Before 2017 the price of Bitcoin was stable as it wasn't
| worth anything.
|
| You live in an alternate reality.
| anonisko wrote:
| Yeah, this is a wildly ignorant take.
|
| Pre 2017 was crazy volatile and unstable. It's still crazy,
| especially compared to regulated, national markets, but it
| does seem to be gradually smoothing out from the wildness
| of it's youth.
| https://www.buybitcoinworldwide.com/volatility-index/
| arcticbull wrote:
| Some of us have maintained a strong anti-Bitcoin position at
| all times.
|
| [edit] David Gerard comes to mind - author of Attack of the 50
| Foot Blockchain and Libra Shrugged - and HN user (dgerard I
| think) (https://davidgerard.co.uk/)
|
| More recently Amy Castor, also an HN user (amycastor)
| (https://amycastor.com/)
|
| And of course Bitfinex'd is back and public again on Twitter.
| (https://twitter.com/Bitfinexed)
| bombcar wrote:
| /r/buttcoin has memes but it also has some pretty serious
| discussions
| arcticbull wrote:
| One thing I really appreciate about them is unlike
| literally every other crypto sub, they're not an echo
| chamber. Nobody as far as I can tell is ever banned for
| being pro-crypto, or posting pro-crypto content. If they're
| hard-core shills or brigading they get downvoted or get
| slapped with a playful flair ("warning, I have the brain
| worms" is my favorite haha).
|
| As such it gets a lot of pro-crypto folks participating to
| get a different perspective. It's not high brow HN level
| discourse but to your point a lot of serious stuff ends up
| there.
|
| Considering the topic it's pretty balanced.
| kodah wrote:
| > Where were all these articles during all those price lull
| periods?
|
| People are motivated to talk and report based on a myriad of
| things, but lately this perception of "power" has been center
| stage. If you ask these people I imagine they would tell you
| that when Bitcoin hits a high it makes those people, and
| Bitcoin, very powerful while when it's $8 they're just nobodies
| wasting time in a dark room and coming up with memes like HODL.
| glitchc wrote:
| Fiat money works because government has a strong say in its
| creation and valuation, and govt. is elected by the people.
| Lobbying and other private interests aside, by and large, the
| system is still beholden to the opinions of the citizenry.
|
| Decentralized finance, while originally designed to give more
| power directly to the people (Nakamoto's "one CPU one vote"), is
| now clearly shown to be beholden to an oligopoly of private
| interests. It's important to point out the reality behind the
| fallacious narrative of "the people are in control," so that
| people wake up and realize that DeFi without govt. intervention
| is a bad thing.
|
| An individual has zero say in Bitcoin prices. At least with fiat
| currency, if they don't like what's happening, they can change
| the govt. to one that is more aligned with their collective
| fiscal view.
| Empact wrote:
| That's strange because I see it essentially in reverse of that:
|
| To change the Bitcoin price, vote with your dollars, going long
| or shorting. You will materially impact the order book and
| resulting price. Other ways exist: starting a company like the
| ones mentioned in the article.
|
| In contrast, in federal elections you have a vanishingly small
| chance of casting a deciding vote between two participants in
| an actual oligopoly (more specifically, a duopoly), who are
| themselves primarily allied with powerful interests which
| include the banking sector. Does anyone really believe their
| reps are responsive to them on issues like monetary policy?
| [deleted]
| Bakary wrote:
| This is the problem with anarchy. People forget how states
| formed in the first place...
| jaspax wrote:
| The notion that citizens have a say over their country's fiscal
| policy seems pretty unsupportable to me. In the US, the Federal
| Reserve is specifically designed to _avoid_ political pressure,
| and the European banking institutions are even more insulated
| from the consequences of elections. Your vote 's impact on
| currency policy is very small, indirect, and highly delayed in
| time, so much so that it is for all practical purposes equal to
| zero.
| glitchc wrote:
| Pretty unsupportable? Complete and utter nonsense. The Fed
| just handed out cheques to all Americans because Congress
| asked it to. It was unprecedented in US history, and the
| strongest indication that the system still works for the
| average person. Under what circumstances would that be
| possible with Bitcoin? Do the big whales in crypto care that
| you've lost your job? Congress does because it's their job to
| care. That's how government works. It's not perfect but it's
| far better than the alternative people seem to be proposing.
|
| Anarchy only works for the person on top, and they know it,
| that's why in every real anarchy, the ones on top spend most
| of their resources trying to stay on top. For everyone else,
| it's a universally miserable experience.
| grugagag wrote:
| I want to believe you but keep in mind that at the same
| time the government also propped up the private sector
| (special interests) and it did spend way more than on the
| citizenry. Industries that were too big to fail were bailed
| out while a big chunk of the population were left unable to
| support themselves and I'm sorry but a check or two of a
| few thousands is not gonna do a damn thing for them when
| they are forced to foreclose their mortgages.
| ketamine__ wrote:
| Big industry means lots of jobs. They were right to bail
| them out. Are we supposed to let the car industry die on
| principle if it causes a massive amount of destruction?
| China wouldn't let it happen.
| dragonwriter wrote:
| > The Fed just handed out cheques to all Americans because
| Congress asked it to.
|
| Uh, no, the Fed didn't.
|
| The US Treasury did because Congress directed (not asked)
| it to. Congress can make non-binding requests, but neither
| round of stimulus checks was a product of such a nonbinding
| request, and neither was executed by the Fed.
|
| > It was unprecedented in US history
|
| The size was bigger, but broad individual stimulus checks
| based on past tax filings are not unprecedented in US
| history. They were done in 2001, for instance.
|
| > Under what circumstances would that be possible with
| Bitcoin?
|
| Fiscal stimulus would be just as possible with a Bitcoin
| monetary system as a fiat one; the difference is that the
| divide between fiscal and monetary policy, which MMT
| correctly points out is artificial in a fiat system, would
| be a hard divide in a Bitcoin system, which would mean that
| joke in fiat where securing financing such as by selling
| debt is not strictly require for deficit spending in a fiat
| system, though traditionally done because of the strength
| of the belief in the fiscal metaphor, in a Bitcoin system
| there would be hard constraints which would require
| financing of deficit spending. This would probably drive up
| the cost of borrowing, since while lenders don't want
| borrowers to monetize debt, the fact that they ultimately
| can reduces default risk since it is impossible for a
| debtor whose debts are denominated in its own fiat to be
| forced to default through insolvency.
| ffggvv wrote:
| am i the only one that gets a warm euphoric feeling going on the
| crypto subreddits on days like these and drinking their salty
| tears as it crashes to hell?
| wtf_is_up wrote:
| >crashes to hell
|
| Zoom out.
| mamon wrote:
| "Past performance is not indicative of future results"
|
| EDIT: it might be a lawyerspeak, but it is still a good
| advice: there's a reason why Bitcoin has been down $14k this
| week and that reason is the settlement with NYAG in the
| Tether lawsuit. Situation has changed, there's one fewer scam
| company there to artificially inflate Bitcoin price, so
| expect downward trend for at least the next few months.
| ravenstine wrote:
| That phrase is lawyer-speak that only exists for the sake
| of mitigating liability. Of course every conceivable thing
| has a non-zero risk.
| wtf_is_up wrote:
| I fail to see the relevance of the cliche you've posted
| here. BTC has 'crashed to hell' all the way down to where
| it was 07 Feb 2021 after doubling a few times and the
| parent post is spitefully spiking the football by 'drinking
| salty tears'. Has nothing to do with predicting the future.
| sah55 wrote:
| Yes I think you might be the only one (btw +380% since 2020)
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