Bitcoin now at $16,600.00. Those of you in the old school who believe this is a bubble simply have not understood the new mathematics of the Blockchain, or you did not cared enough to try. Bubbles are mathematically impossible in this new paradigm. So are corrections and all else pic.twitter.com/go9v0w92zk
— John McAfee (@officialmcafee) December 8, 2017
I’ve got nothing against collectibles, and I have the Franklin Mint plates to prove it. But most of the little I know about economics I got from reading J.K. Galbraith, so whenever people start talking about Free money — guaranteed to appreciate!, the alarm bells go off. From the Washington Post:
Bitcoin soared past the $17,000 mark on Thursday, a dizzying run for a digital currency that was worth less than $1,000 at the start of the year and was once largely the preoccupation of technologists or those looking to avoid scrutiny to launder money or buy drugs and weapons online.
The fast rise — it has gone up more than 40 percent this week alone — is creating a buying frenzy among eager speculators around the world and helping push bitcoin into the mainstream. And it is also forcing U.S. regulators to grapple with whether to legitimize a product that operates outside the control of any government or financial institution.
The run-up in price comes as bitcoin enthusiasts prepare to reach a new landmark. On Sunday, a bitcoin product will trade for the first time on a U.S. financial market, making it almost as easy to bet on the virtual currency as oil, corn or the euro…
Uhhh… about bitcoin… it's actually ruining the planet.
The bitcoin computer network currently uses as much electricity as Denmark. In 18 months, it will use as much as the entire United States.
Something's gotta give. This simply can’t continue.https://t.co/KSmaCZLXh7
— Eric Holthaus (@EricHolthaus) December 5, 2017
…Much of the computer power sustaining bitcoin occurs at massive complexes – or farms – in rural China running on electricity from coal-fired generating plants in Sichuan and Inner Mongolia. Reporters from Quartz and Bloomberg visited one of the massive farms in August, and said it had eight warehouses containing 25,000 processing machines, or about four percent of the global bitcoin network.
As bitcoin prices soar, more processing machines are likely to be added.
The complexes earn money by solving cryptographic puzzles that permit bitcoin transactions in a block, vying for a block reward that is currently 12.5 bitcoins, or $212,487 at the valuation at 2 p.m. Thursday. Competition is fierce between mining operations…
From the Atlantic, “Bitcoin Is a Delusion That Could Conquer the World“:
… If every currency is a consensual delusion, then bitcoin, a digital cryptocurrency that changes hands over the internet, feels more like a consensual hallucination on psychedelic drugs. The concept of bitcoin was born in a detailed white paper published in late 2008 by a pseudonymous “Satoshi Nakamoto.” By 2013, one bitcoin was worth $12. As of this writing, it’s worth more than $10,000. Its value has doubled in the last two months alone. For any currency’s value to increase by 100 percent in eight weeks is, to use a technical term, bonkers. If the Japanese yen or American dollar did the same, their economies would plunge into an infernal deflationary spiral…
Nobody knows for sure whether the blockchain will transform the economy of the future, as Andreessen foresees. What’s clearer, however, is that it has not transformed the economy of today. While the number of bitcoin transactions is growing every year, it’s nothing close to a mass-market consumer technology, like Google, or Netflix, or even PayPal. Bitcoin remains cumbersome to use (the typical transaction can take up to 10 minutes) and the price is extremely volatile. It is, for now, a frankly terrible currency built on top of a potential transformative technology.
Which leads to perhaps the most obvious question: If bitcoin appears to have flopped as a mass-market currency, why has it so suddenly succeeded as an investment vehicle?…
Even if one buys the argument that blockchain is brilliant, cryptocurrency is the new gold, and bitcoin is the reserve currency of the ICO market, it is still beyond strange to see any product’s value double in six weeks without any material change in its underlying success or application. Instead, there has been a great and widening divergence between bitcoin’s transaction volume (which has grown 32 times since 2012) and its market price (which had grown more than 1,000 times).
Surveys show that the vast majority of bitcoin owners are buying and holding bitcoin to exchange them for dollars. Let’s be clear: If the predominant use case for any asset is to buy it, wait for it to appreciate, and then to exchange it for dollars, it is a terrible currency. That is how people treat baseball cards or stamps, not money. For most of its owners, bitcoin is not a currency. It is a collectible—a digital baseball card, without the faces or stats…
Maybe the solution to the Fermi paradox is that significantly advanced civilizations discover crypto currencies and then furiously burn through all available energy sources until they go extinct https://t.co/gdQgfthNp8
— Simon Willison (@simonw) December 6, 2017
Given what we know about how efficient and leveling and inherently self-regulating the free market is, it's weird that bitcoin would instantly turn into Pogs. https://t.co/lCg6b7svmy
— David Roth (@david_j_roth) December 11, 2017
Bitcoin 10,000 is gonna be more fun on the way down.
— Josh Barro (@jbarro) December 8, 2017
hmm a bunch of techno-libertarian dumbasses ruining something nice for everyone, a bit of a recurring theme these days
— Suburban Yeti (@shavedbigfoot) December 10, 2017