Baron's Crypto Trading Journal

Baron said:
Bitcoin is not a competitor to the U.S. dollar in terms of it being a medium of exchange, so you can't really compare the two in that way. That's why the IRS has already ruled Bitcoin as property, not as a currency.

I think this point is where a lot of people get confused. Bitcoin is not replacing the dollar, so don't view it like that.

Bitcoin is best viewed as your internet savings account. It's where you sweep your unused cash in order to protect that cash from the deteriorating effects of fiat money printing and the resulting currency debasement that inevitably happens. When you do that, you keep that cash stored securely out of the hands of the banks that could confiscate your money at any time in a financial crisis, and you prevent that money from essentially going to zero, which at a real inflation rate of 14%, would happen in only 7 years if that money was in a savings account. And not only would you be protecting that money from inflation, you would be benefitting from the deflationary nature of your savings account. As an example, imagine if you put your $50k in savings into your bitcoin savings account 7 years ago. I'll let you look up what Bitcoin's price was back in 2014 and figure out what that $50k would be worth today.

And don't listen to these naysayers who's time frame of looking at all this is three friggin' months. I mean you can, but it would be to your detriment in 7 years from now.
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Aren't you supposed to throw in the past performance disclaimer? :)

Ok so I keep my money out of the hands of the big banks. Who do I turn to is something happens to my money? If you look in your account tomorrow and notice a discrepancy, what is the process?
 
Question about the block reward.

Couldn't the algorithm randomly choose 2-3 miners to solve the block and whoever verifies it first wins as opposed to everyone constantly trying to do it?
 
deaddog said:
Ok so I keep my money out of the hands of the big banks. Who do I turn to is something happens to my money? If you look in your account tomorrow and notice a discrepancy, what is the process?
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I'm sure what you mean by "something happens".

Discrepancies are almost always because of human error, like a bank teller who enters in the wrong SWIFT code for a wire transfer. There are no third-party humans involved in bitcoin transfers.
 
Baron said:
I'm sure what you mean by "something happens".

Discrepancies are almost always because of human error, like a bank teller who enters in the wrong SWIFT code for a wire transfer. There are no third-party humans involved in bitcoin transfers.
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So if you make a mistake there is no way to correct it? Misplaced decimal etc. It's happened to me. Transferred 25k when I meant to move 2500. Phone call to the bank solved the problem.
 
nooby_mcnoob said:
Question about the block reward.

Couldn't the algorithm randomly choose 2-3 miners to solve the block and whoever verifies it first wins as opposed to everyone constantly trying to do it?
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No, it doesn't work like that

edited too many words

Google or YouTube "Bitcoin mining"
 
johnarb said:
No, 1 satoshi/byte

The lowest denomination of Bitcoin is a satoshi which is 0.00000001 btc
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LOL; You get old you don't see the small print. Made an assumption and was wrong. It happens more often than I'd like.
 
Baron said:
Bitcoin is not a competitor to the U.S. dollar in terms of it being a medium of exchange, so you can't really compare the two in that way. That's why the IRS has already ruled Bitcoin as property, not as a currency.

I think this point is where a lot of people get confused. Bitcoin is not replacing the dollar, so don't view it like that.

Bitcoin is best viewed as your internet savings account. It's where you sweep your unused cash in order to protect that cash from the deteriorating effects of fiat money printing and the resulting currency debasement that inevitably happens. When you do that, you keep that cash stored securely out of the hands of the banks that could confiscate your money at any time in a financial crisis, and you prevent that money from essentially going to zero, which at a real inflation rate of 14%, would happen in only 7 years if that money was in a savings account. And not only would you be protecting that money from inflation, you would be benefitting from the deflationary nature of your savings account. As an example, imagine if you put your $50k in savings into your bitcoin savings account 7 years ago. I'll let you look up what Bitcoin's price was back in 2014 and figure out what that $50k would be worth today.

And don't listen to these naysayers who's time frame of looking at all this is three friggin' months. I mean you can, but it would be to your detriment in 7 years from now.
More...
Thanks for the response. I don't think I explained what I was getting at well enough. I don't mean that Bitcoin would replace the US Dollar. I just meant that as a currency that would be used for exchange in goods and services, that with a finite supply of Bitcoin, it would all end up eventually in the hands of a few. Those few would be the ones who garnered the most demand for their goods and services payable in Bitcoin.
 
Why treating Bitcoin as currency when it is unstable is bad idea.

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