Re: The Bitcoin environment seems toxic right now... has it felt like this before?
Follow up on my prior post above...
more like 0.0001% of total population
I was assuming 2 million users now and target penetration of 2 billion users => 0.1%.
It is true that most of the 2 million are not really "using" bitcoin now, so we cannot yet directly observe how world-changing Bitcoin is. This "land-grab phase" is designed to take us there.
My 0.01% - 0.03% guesstimate was 600,000 to 1.8 million based on world population of 6 billion.
Dogecoin (why don't they pronounce it "doggiecoin" or "dog-ecoin"
) claims 100,000 users yet the mcap is only $43 million. Apparently it is the copper-zinc penny coin (feel good marketing, donations, cute dogs) and Litecoin is the current silver to Bitcoin's gold.
Isn't market cap more relevant+concrete than the nebulous concept of "users" (not all types of users are the same).
Feel free to copy or reply to this on your other thread that is relevant to this issue.
We are clearly in investment only stage, because who can use a daily currency that is taxed for capital gains on every spend. That will block any major application as a currency until governments bless it as legal tender. But why would governments ever bless it since it removes their authority to control the money supply?
At some point the reality of that has to hit the investment demand. But I guess we have a lot of myopia to go before the "stampede to the exits" realization.
That question makes no sense to me as a U.S. tax payer. Given a choice between holding my spending money in a form which loses value costs me much more than does holding it in a form which gains value, regardless of whether the gains are taxed.
1. The hassle of recording and paying tax for numerous daily tidbit transactions is far outweighed by the insignificant value loss of holding $500 in your checking account (exhibit my prior post that average Dogecoin holding is claimed to be $430 per user).
2. You are not thinking like the masses who are not the rich precisely because they don't have a lot of savings to invest. And thus they don't have the same priority set as you. But you as an investor in what you want them to use, need to think like them to understand this investment.
I saw this within my initial study of Bitcoin yet Risto (and you?) apparently haven't registered this in your consciousness yet after years of being invested.
The wildcard is if there could be an application (other than investing) that targeted the rich demographic which is investing in Bitcoin. Well that is...anonymity. They will need it to survive what is coming! And Bitcoin doesn't have it.
You just proved my point.
Again you misjudge the masses, because you are not one. You can't put yourself in their mindset and priority set. I can.
That question makes no sense to me as a U.S. tax payer. Given a choice between holding my spending money in a form which loses value costs me much more than does holding it in a form which gains value, regardless of whether the gains are taxed.
1. The hassle of recording and paying tax for numerous daily tidbit transactions is far outweighed by the insignificant value loss of holding $500 in your checking account (exhibit my prior post that average Dogecoin holding is claimed to be $430 per user).
There is no hassle, because it is trivial to automate.
In theory yes, but in practice no. I detect you don't have real world experience doing technical support for a software company. I do.
You don't have every user using the same application and tax regime. Some tax regimes are not even efile yet.
And users will avoid something with no advantages which carries the stigma of needing to pay a tax. If they are using it as a currency, they aren't paying attention to gains, and see the tax only as a burden and risk (what if they automation fails, they lose their backup copy, then can't comply with the tax filing!)
Eventually you could get there, but long before that the government will have taken over the exchanges, the pools, and the coin. Or simply offered a digital fiat which doesn't have Bitcoin's problems.
And btw, what is the advantage for the average person to use Bitcoin and go through this hassle to set up this software? None that I can see.
For those in the 3rd world, they use cash and the vendors they buy from will not be accepting Bitcoin any time soon. Simply worse for them in every way.
There is nothing they can gain from being banked with Bitcoin that they couldn't get with cash.
Even money transfer using Bitcoin is stupid, since they need to convert to cash any way.
For those minority who don't (a super majority does) file taxes in the developed countries, I still don't see what is the reason for them to use Bitcoin?
Most in USA file a tax return to get their payroll deductions refund, or their Child Tax credit, etc.. I don't know about Europe?
For example, localbitcoins doesn't have an app for that. They would need to customize the app for every tax regime too.
Capital gains is one of them as this scales away from investors to consumers.
Indeed there are many other problems that make Bitcoin impractical. The argument is always offchain services, but those are a problem too or bring us right back to fiat.
I just don't see the big idealistic win. If you are just hoping to help the government create a digital fiat, and get rich on that investment, I doubt it will work out, because of the $223 trillion debt the government is going to confiscate all the wealth it can find. And remember Bitcoin isn't anonymous so you can't reliably hide in it.
P.S. if the quality of my prose is declining, it is because I've been awake for 20 hours and forehead is ready to meet keyboard.
Currently we only have 0.1% of the population so it will grow regardless. The "masses" are not yet involved in 2014.
more like 0.0001% of total population
I was assuming 2 million users now and target penetration of 2 billion users => 0.1%.
It is true that most of the 2 million are not really "using" bitcoin now, so we cannot yet directly observe how world-changing Bitcoin is. This "land-grab phase" is designed to take us there.
My 0.01% - 0.03% guesstimate was 600,000 to 1.8 million based on world population of 6 billion.
Dogecoin (why don't they pronounce it "doggiecoin" or "dog-ecoin"
) claims 100,000 users yet the mcap is only $43 million. Apparently it is the copper-zinc penny coin (feel good marketing, donations, cute dogs) and Litecoin is the current silver to Bitcoin's gold.Isn't market cap more relevant+concrete than the nebulous concept of "users" (not all types of users are the same).
Feel free to copy or reply to this on your other thread that is relevant to this issue.
We are clearly in investment only stage, because who can use a daily currency that is taxed for capital gains on every spend. That will block any major application as a currency until governments bless it as legal tender. But why would governments ever bless it since it removes their authority to control the money supply?
At some point the reality of that has to hit the investment demand. But I guess we have a lot of myopia to go before the "stampede to the exits" realization.
who can use a daily currency that is taxed for capital gains on every spend.
That question makes no sense to me as a U.S. tax payer. Given a choice between holding my spending money in a form which loses value costs me much more than does holding it in a form which gains value, regardless of whether the gains are taxed.
1. The hassle of recording and paying tax for numerous daily tidbit transactions is far outweighed by the insignificant value loss of holding $500 in your checking account (exhibit my prior post that average Dogecoin holding is claimed to be $430 per user).
2. You are not thinking like the masses who are not the rich precisely because they don't have a lot of savings to invest. And thus they don't have the same priority set as you. But you as an investor in what you want them to use, need to think like them to understand this investment.
I saw this within my initial study of Bitcoin yet Risto (and you?) apparently haven't registered this in your consciousness yet after years of being invested.
The wildcard is if there could be an application (other than investing) that targeted the rich demographic which is investing in Bitcoin. Well that is...anonymity. They will need it to survive what is coming! And Bitcoin doesn't have it.
Applying the criteria of logical coherence which you impose upon those you disagree with, I should therefore conclude that you are incapable of competent cognition and should be ignored.
Of course that criterion is a ludicrous one, but I thought it might be helpful to you if I pointed that out.
Of course that criterion is a ludicrous one, but I thought it might be helpful to you if I pointed that out.
You just proved my point.
Again you misjudge the masses, because you are not one. You can't put yourself in their mindset and priority set. I can.
who can use a daily currency that is taxed for capital gains on every spend.
That question makes no sense to me as a U.S. tax payer. Given a choice between holding my spending money in a form which loses value costs me much more than does holding it in a form which gains value, regardless of whether the gains are taxed.
1. The hassle of recording and paying tax for numerous daily tidbit transactions is far outweighed by the insignificant value loss of holding $500 in your checking account (exhibit my prior post that average Dogecoin holding is claimed to be $430 per user).
There is no hassle, because it is trivial to automate.
In theory yes, but in practice no. I detect you don't have real world experience doing technical support for a software company. I do.
You don't have every user using the same application and tax regime. Some tax regimes are not even efile yet.
And users will avoid something with no advantages which carries the stigma of needing to pay a tax. If they are using it as a currency, they aren't paying attention to gains, and see the tax only as a burden and risk (what if they automation fails, they lose their backup copy, then can't comply with the tax filing!)
Eventually you could get there, but long before that the government will have taken over the exchanges, the pools, and the coin. Or simply offered a digital fiat which doesn't have Bitcoin's problems.
And btw, what is the advantage for the average person to use Bitcoin and go through this hassle to set up this software? None that I can see.
My gosh you missed the main point. The masses like fiat! They don't require that the digital currency of the world needs to not be a fiat.
And you did not address the point that the masses don't like the properties of Bitcoin:
Fiat doesn't have those weaknesses. Fiat has other weaknesses which we are concerned about, but the masses don't care about those weaknesses that bother us. Later the masses will fall into the abyss, then some of them will learn to appreciate our ideals but most of them won't learn.
And you did not address the point that the masses don't like the properties of Bitcoin:
- Mixes traceable illegal activity with their funds
- No protection against theft
- No refundable protection
- No consumer protection
- Very volatile price
- Must convert to and from fiat which is a hassle
- Very slow transactions, and confusing
- No government guaranteed deposit insurance
- Can't obtain a loan or credit card in bitcoins
- There is no cash version to use offline.
Fiat doesn't have those weaknesses. Fiat has other weaknesses which we are concerned about, but the masses don't care about those weaknesses that bother us. Later the masses will fall into the abyss, then some of them will learn to appreciate our ideals but most of them won't learn.
A pretty large set of users just don't file tax returns, and could not care in the least.
For those in the 3rd world, they use cash and the vendors they buy from will not be accepting Bitcoin any time soon. Simply worse for them in every way.
There is nothing they can gain from being banked with Bitcoin that they couldn't get with cash.
Even money transfer using Bitcoin is stupid, since they need to convert to cash any way.
For those minority who don't (a super majority does) file taxes in the developed countries, I still don't see what is the reason for them to use Bitcoin?
Most in USA file a tax return to get their payroll deductions refund, or their Child Tax credit, etc.. I don't know about Europe?
Another large set have people who do that for them. The remainder generally have an app for that.
For example, localbitcoins doesn't have an app for that. They would need to customize the app for every tax regime too.
Bitcoin has enormous usability problems for quotidian consumer applications. I am acutely aware of this. But capital gains tax is not one of them.
Capital gains is one of them as this scales away from investors to consumers.
Indeed there are many other problems that make Bitcoin impractical. The argument is always offchain services, but those are a problem too or bring us right back to fiat.
I just don't see the big idealistic win. If you are just hoping to help the government create a digital fiat, and get rich on that investment, I doubt it will work out, because of the $223 trillion debt the government is going to confiscate all the wealth it can find. And remember Bitcoin isn't anonymous so you can't reliably hide in it.
P.S. if the quality of my prose is declining, it is because I've been awake for 20 hours and forehead is ready to meet keyboard.