If it had been 'shit' or something generic like that I might believe it, and I can believe one said 'rat poison', but I find that headline very hard to believe.
edit: The price was about $100 when Munger called it Rat Poison, and about $10,000 when Buffet called it Rat Poison Squared, so Buffet was amazingly accurate
Well the answer to your question is in the article:
> Billionaire investor Warren Buffett has in the past characterised bitcoin as "rat poison squared". One third in the JPM survey agreed with that view. Another 16% thought it was a temporary fad.
The question was not "what are your thoughts on cryptocurrencies? Please write at least 100 words", it was more along the lines "do you agree with Warren Buffet's view that Bitcoin is 'like rat poison squared': [ ] Yes [ ] No"
Oil would be a threat to a coal baron but how is cryptocurrency a threat to investment bankers? It's easy money for them if they thought it was worth anything.
The banking system relies on inflationary currency. Some crypto is not only not inflationary (in the long run) but provably so. A world where the money supply is fixed is a very different trading environment.
Defi, were it more common and regulated lightly, could take a lot of business away from banks and investment banks. I’m not saying that’s likely, but it is a plausible threat in that sense.
I agree that crypto is worthless - especially compared to effort in that space - but "temporary fad"? That's extreme underestimation of human stupidity.
I tend to think the opposite, that large cryptocurrencies are likely to always be worth more than $0, even if some black swan like a 51% attack were to happen. After all, "worth" is subjective, and the behavioral guarantees cryptocurrencies make (notwithstanding black swans) are attractive in assets.
When I see "crypto" I don't immediately think of cryptocurrency. I though this was going to be an article about privacy, about how companies committed to strong crypto in their products will face challenges and so are bad investments. But no, "cypto" is now shorthand for coins as they continue to eat the world. Soon I'll be that old man telling kids about the days when a coin was a bit of metal that we could put into a machine to buy things. Of course by then the kids will be fascinated at the concept of exchanging money for goods without waiting for the blockchain to update.
Good. The next time some CIA man-in-black speaks up about the need to ban strong crypto we can rest assured that nobody will understand what he is talking about.
I agree with you. But to be fair, cryptography and cypherpunks are/were closely related, and a topic often discussed was what we now call cryptocurrencies as an umbrella term. Not a big deal it gets shorted to "crypto".
What I hate about crypto: These extreme positions on the subject. It has become like politics, bipartisan. How is this useful? Where is the middle ground?
For a long time I was happily sitting in the “I have no use for cryptocurrency” zone, occasionally checking in to see if things changed or reading a blog post here and there to see if there was something I was missing. But as the energy usage has ramped up to nation-state levels without an accompanying increase in usefulness, I’ve slid much more in the “cryptocurrency is dangerous to humanity” direction.
Idk if I’d call it a “fractal set of scams”, but I think “more bad than good” is a fair characterization.
I’d argue that the web had Facebook, EBay, Google, and Amazon 13 years after launching, what are the crypto folks waiting for if it’s so revolutionary? Where are the killer apps, and how much longer do we have to wait?
Unfortunately it’s only black or white, no grey area. Agree with one position, be branded by the opposition.
I like the idea of crypto currencies, if done well, but what we see are not actual currencies, imho. They are volatile assets at best, but usually just scams generally.
And if they aren’t designed to be scams, they will definitely be abused as one, looking at DOGE.
There really is no middle ground. Either you are short bitcoin and will pay the penalty or are long bitcoin and will benefit from "hardest money wins" in action.
The middle ground is when people stop actually using cryptocurrencies to speculate and crypto actually back the security they're selling with real assets.
The middle ground is that it's fine to invest in stuff which is characterized by volatility as long as the consequences are on your own account and you can justify the reasons to do so. Apart from the fact that most media outlets thrive by feeding a bi-partisan story, there's in essence only yourself to blame. The crypto market as of now has a lot of similarities to the pre-2000 Internet bubble. Lots of shitcoins and creation of a large bubble. The fact that incumbent investment firms and companies are looking into it doesn't mean they have it right. Time will tell how this all plays out.
As there should be! I have no problem with you taking 10% of your net worth and betting it on moonshots. Hell if you really want to drop 100% in (I have some extended network folks that did) then go for it, as long as you know what you are doing. But my 401K? Bitch please. Thats not a moonshot. I'm not trying to get rich and sip pina coladas on the beach. I'm trying to make sure I'm not homeless from 60 to dead when I can't produce. I want slow, steady, measured returns. I don't care that I missed out on the 1 in 10 moonshots as long as I also missed out on the 9 in 10 rug pulls.
Ok, so lets imagine that Btc/Eth fall back to pre-COVID levels.
This means that a huge amount of people will have lost money, and electricity and hardware will have been burnt up for minimal or negative gains.
What is the point of maintaining the legal status of crypto at that point?
Specifically, by maintaining its legality, we still have to deal with the huge problem of ransomware, and some residual mining activity (and fraudulent/wasteful use of electricity, right at the same time we are trying to save the climate).
Why not just ban the formal legal exchange of crypto for fiat now?
Cryptocurrency was literally created by cypherpunks for the explicit purpose of evading governments and centralized power. Before it became popular its primary usage was in darknet drug markets. Legality is largely meaningless for crypto.
The value may drop after a ban, but crypto will remain a mainstay for any transactions that require freedom, privacy, or both.
Converting between crypto and fiat wasn't exactly straightforward when Darknet drug markets were the primary use case, but it was still done frequently. It will always be possible to use something like LocalMonero/LocalBitcoin or a decentralized exchange like Bisq or Haveno to convert as you wish.
And as long as crypto is accepted in a single country you're good. Centralized exchanges will just move to countries that haven't banned exchanges.
I agree - but if Bitcoin and other crypto is reduced to the role of buying drugs and other contraband, it would suggest a price $200-$500 (as it was back in 2014 when that was its primary use), not $33,000.
Definitely, there is an insane amount of speculation priced in. The current prices are not even remotely justified, but crypto was never meant to be a speculative trading platform, it was meant to be used. The price cratering wouldn't really bother me.
There is clearly non-zero utility in BTC for certain individuals. But it's also clear that a large portion of BTC is held as speculation. Have there been any formal attempts to identify fair market value out of BTC or other crypto assets based on their current use cases?
It’s almost an impossible question given that the “use cases” that are NOT speculating boil down to “transfer of funds” and there’s not really a difference between “transferred $1m USD as 10 bitcoins” and “transferred $1m USD as 10b dogecoins”.
I guess you’d have to figure out the “total active use case market” (I.e; factor out speculation) and then work out how many coins you have available to support that.
So if there’s a $100m market for transfers per month and a million coins, they may be valued at $1.
So if you can't back a security with anything tangible then the true underlying value is 0. This means no one will buy it back if the currency falls to a value near 0. See the recent brouhaha about Titan (e.g.). Gold and silver at least have real use outside of "being pretty". That fixes the lowest possible value for gold to be above 0 somewhere.
It does have some utile value, and that value is somewhere between 0 to infinity.
The speculators are hoping for a "greater fool" who will buy their assets because you know, numbers go up.
The criminals like it for the money laundering aspects. It's not a perfect money laundering tool, but it's certainly good enough for ransom ware (until recently when the US reclaimed some money from ransomware writers).
There is some payment transfer capability, but here the utility comes at a price for some fee paid to transfer the money.
The volatility keeps it from having very much utility as a store of value. Price was once over $60k but now dropped under $30k then back up to $34k. But volatility is not what you want as a store of value. You want stability and assets backed by something tangible.
Largely it seems like the utility value is that "people think there's actual utility" when in fact, the utility is provided by speculators.
All those people would have sold their left you know what for an entry in btc around 500, not even back to when it was worth less than a dollar.
Maybe in their minds those who bought early and realized their gains managed to get the cheese and avoid the rat poison?
In any event, I never understood the absolute need that people on Wall Street have to talk about stuff...like you work on Wall Street because you choose to predict things and participate in the zero sum game...you get the pro and cons of that.
If it had been 'shit' or something generic like that I might believe it, and I can believe one said 'rat poison', but I find that headline very hard to believe.
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