I can't tell if this is a parody post or not. But I will try to understand it.
> Bitcoin doesn't have a dividend...in order to realize any gains you have to sell it
So...like gold and silver? We've already had those for millennia. We've also had inequality for millennia - and at times it was way worse than it is now.
> The script gets flipped if that asset is a hard, un-inflatable asset like bitcoin with a built in scarcity mechanism.
I'm trying to understand this. If everyone puts their money into Bitcoin, inflation won't eat the value of their money so they won't try to increase it by investing into dividend-producing businesses? Otherwise how is this "script" "flipped? I don't understand this line of reasoning.
Also if lots of people pull money out of dividend-producing businesses and put it into Bitcoin, the prices of those assets will go down which will make their returns even better. So it seems like it would cause more of the thing ("elites" putting capital into revenue producing assets) that you're saying is the problem here.
> a lot of the truly rich people in this world have income producing businesses and other assets aside from stocks but you could argue that that's a lot better than money simply producing more money.
Money simply producing more money is bad, but selling appreciated Bitcoin to make money is good? I don't see the difference between the two. And flipping Bitcoin is better than using fiat money to start businesses that produce value?
Like maybe you have a good point but I have no idea what you're trying to say or how it relates to TFA.
> yet you mention bitcoin on hacker news and you're down-voted to oblivion,
Maybe only mention it on articles related to Bitcoin or other cryptocurrencies?
> The world desperately needs bitcoin to succeed.
Given the already-well-known environmental cost of mining Bitcoin, one could argue that that's the last thing the world needs.
Yes, except gold and silver don't scale. Bitcoin scales, it's almost infinitely divisible and can be traded without a third party on the internet. It's Gold 2.0.
> I'm trying to understand this. If everyone puts their money into Bitcoin, inflation won't eat the value of their money so they won't try to increase it by investing into dividend-producing businesses? Otherwise how is this "script" "flipped? I don't understand this line of reasoning.
No, but if bitcoin proves to be the better investment (which it has over the last decade of its existence) people will put their money where they can get the best return. Bitcoin is still largely unproven and considered risky but the more times it increases exponentially in value the more stable and secure it will seem.
To put it another way - If I had 1 million dollars ten years ago conventional wisdom would have said the absolute best place I could have put it was either the stock market or into real-estate. Looking back obviously there would have been no better place to put it than into bitcoin but nobody knew that back then.
The more people who move their investments away from "Conventional" investments like real-estate and into more inclusive assets like bitcoin the better it is for society as a whole. It's well documented that one of the big reasons silicon valley is so expensive to live in is because Chinese investors are moving in and purchasing real-estate just to sit on, good for them, bad for people in the area who get no piece of that economic action.
I could go on and on. I'm not going to pick apart every point you made but I certainly can, I think you'll see the light in a few years when bitcoin does what it does and skyrockets again.
Can I ask you this though: Do you think bitcoin will gain in value from this point on or do you think bitcoin will fizzle out, and why do you think that?
> Do you think bitcoin will gain in value from this point on or do you think bitcoin will fizzle out, and why do you think that?
If I knew the answer to that, I'd be off making money rather than arguing with random strangers on the Internet :-)
Gold and silver have valid (if limited) practical utility and thousands of years of history as stores of value. Bitcoin has neither. And gold and silver only became synonymous with money and value once they began to be used in coinage i.e. as a currency, issued by the state, and you could pay taxes with it.
Your thesis is "Bitcoin is a good investment because it appreciates". It doesn't answer "why does Bitcoin appreciate?". Practically everything that can be called an "investment" or "asset" has at least one of two properties:
1. has practical use
2. generates income
Say all you want about investors buying up houses and driving up prices (and the Bay Area's housing problems run deeper than that), but they're getting an asset that has actual value. Even if people stop believing in the value of houses, a house will still shelter you, and afford access to good jobs and/or surroundings/weather.
I'll grant you that Bitcoin has one property that can't be found anywhere else. It's a store of value that can be exchanged without intermediaries. So it has exactly one practical use.
But the point of a store of value is to...store value. The idea that "someone will pay more for this later" has been the basis of innumerable bubbles and crashes throughout history - as recently as the Great Recession to as far back as the Tulip Mania, and probably farther still. Volatility isn't a great property for a store of value to have, because most people don't like crazy gyrations in their net worth every day.
And if Bitcoin isn't a store of value, but is a currency instead, then it has a different problem. As you said, it's non-inflationary. So people are incentivized to hang onto it rather than spending it.
> Looking back obviously there would have been no better place to put it than into bitcoin but nobody knew that back then.
Past performance is no predictor of future performance. Someone putting a million dollars into Bitcoin in 2017 would be pretty sad right now. People believe in the stock market, not (just) because of its past performance, but because it represents companies that deliver actual, real-world value.
> Bitcoin doesn't have a dividend...in order to realize any gains you have to sell it
So...like gold and silver? We've already had those for millennia. We've also had inequality for millennia - and at times it was way worse than it is now.
> The script gets flipped if that asset is a hard, un-inflatable asset like bitcoin with a built in scarcity mechanism.
I'm trying to understand this. If everyone puts their money into Bitcoin, inflation won't eat the value of their money so they won't try to increase it by investing into dividend-producing businesses? Otherwise how is this "script" "flipped? I don't understand this line of reasoning.
Also if lots of people pull money out of dividend-producing businesses and put it into Bitcoin, the prices of those assets will go down which will make their returns even better. So it seems like it would cause more of the thing ("elites" putting capital into revenue producing assets) that you're saying is the problem here.
> a lot of the truly rich people in this world have income producing businesses and other assets aside from stocks but you could argue that that's a lot better than money simply producing more money.
Money simply producing more money is bad, but selling appreciated Bitcoin to make money is good? I don't see the difference between the two. And flipping Bitcoin is better than using fiat money to start businesses that produce value?
Like maybe you have a good point but I have no idea what you're trying to say or how it relates to TFA.
> yet you mention bitcoin on hacker news and you're down-voted to oblivion,
Maybe only mention it on articles related to Bitcoin or other cryptocurrencies?
> The world desperately needs bitcoin to succeed.
Given the already-well-known environmental cost of mining Bitcoin, one could argue that that's the last thing the world needs.