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Closing schools and lockdown exacerbate the inequality that has already been in place. Instead of seriously looking at how to address the problems, we blame it on lockdowns. We're taught to think that opening schools will fix the problems. The US government printed 16k per individuals. Each person gets 1.4k. The rest goes into "recovery". We just want to find convenient ways to bury the real problems.
For those who are confused by Taleb, I recommend reading some Eastern philosophy. It offers insights for coping with circular and contradictory life. Tao Te Ching, Yi Ching, Buddhist texts.
I have the opposite take. In bull runs, the market swings between BTC and altcoins. Dogecoin rise unintentionally benefits ETH. It weakened Bitcoin but strengthens Dogecoin and Ethereum. With this crash, people will realize that BTC is the crypto that matters. BTC runs the market. The FUD will cause people to flock to BTC. But that's just a guess. Anything can happen in crypto.
Elon Musk will learn that Bitcoin is difficult to control. He seems pretty confused about the market. My guess is Elon has been using Dogecoin to reign in Bitcoin. He's somewhat got what he wanted. Bitcoin has been stagnant for a few months. However, his promotion of Dogecoin pumps other crypto, like Ethereum and their meme tokens. Elon Musk probably didn't expect this. Promoting Dogecoin doesn't directly hurt Bitcoin. It strengthens other altcoins. At some point, it'll hurt Dogecoin.
Bitcoin is shaking Elon Musk off. It has a history of sending thought leaders to the trash bin.
The chart compares Bitcoin's price performance between halvings (2016, current).
Halving price series are calculated since halving date.
The formula is: Projected Price = Price on the compared's mapped date / Price on the compared's halving date * Price on the current halving date.
Taleb changed his mind on this subject. :) I can see Bitcoin as a "stable" long-term Store of Value. Short-term, it's always volatile. It's not suitable as a Medium of Exchange.
The problem with using Bitcoin for payments is volatility. Bitcoin's price is volatile. Bitcoin supporters say volatility will go down "at some point". The logic is pretty silly. Bitcoin is money for the people. But when the super rich people adopt it, volatility will go down. They have more money. The Bitcoin money "tank" will be bigger. Its volatile flow will go down.
Bitcoin is digital gold, God's money. When it comes to volatility, it's up to humans to "fix" it. The fix means we all have to "buy" into it, that is, blindly believe the problem will be fixed somehow. Stop selling, keep holding. Maybe, forever. :)
It's probably not going to be fixed. Volatility is likely an inherent property due to its limited supply.
https://bitflate.org/post/2020/05/10/bitcoin-volatility.html
I follow cryptocurrency and they usually say: Bitcoin Fixes This. It sounds pretty silly. Bitcoin hasn't really fixed anything. It's just a generalization. But the motto draws attention to the cause of many problems in America: the US Dollar monetary system. The Dollar's reserve currency status causes other countries to flood the US with goods in exchange for the currency. It causes trade balances.
The US over time loses its manufacturing and tooling capabilities. Most infrastructure work is custom. You can't build a bridge overseas, ship, and install it in the US. You can build the parts overseas. But it'll take a lot more time and resources to design and assemble them into a bridge in the US. So the final cost ends up being more.
I live in a neighborhood built in the 1980s. Up the hill, there are neighborhoods built in the 1990s and 2000s. After 2000s, houses look pretty much the same. The houses are more expensive. But the amount of custom design decreases over time. It's got more and more expensive to build custom things in the US.
I don't think it's possible to fix these infrastructure costs until we can fix the monetary policy. I think a new crypto system can provide a solution to this problem. Until then, we're stuck with cheap and unnecessary goods while our infrastructure is slowly deteriorating.
Keynesians think money grows on tree. It is true in some senses. Apples grow on tree. At the extreme, they think money is imaginary. They can print as much as they want.
Austrians think money grows from hard money. It is also true in some senses. Money is made from money. It's circular and Ponzi-like. It requires you to believe in what hard money is. Austrian thinking leads to some cult-like behaviors. At the extreme, they'd be rent-seeking their precious Store of Value. It's just as evil as the Keynesians.
Money is data (Keynesian) with some kind of illusions (Austrian). The money that we need is between the Keynesians and Austrians.
Sorry, it's not a guaranteed peg. It's more like a conversion.
It's difficult to build layers on top of the Bitcoin blockchain. The base asset, Bitcoin, is volatile. Its volatility affects the assets on 2nd layers. There isn't a one-one peg between the 2nd layer and the base chain. You'd need to trust an oracle. In your gold example, you'd need to trust the miner for authenticity and their books. For use-cases with oracles, it's more efficient to use a database. There's no need to use a blockchain.
Some projects on Ethereum, like DAI, have explored these use-cases. I think they have not been successful. DAI requires high reserve ratio (1-1.5) to manage the volatility of the base chain. You're using 1.5 USD to get 1 USDDAI. It's not very efficient. I'm less excited about assets on blockchain. I think the market is not ready. We need to reduce volatility first.
Because real world assets don't get minted like crypto. They are tied to physical world. They are volatile. Bitcoin produces a block every 10 minutes. It's a fairly precise schedule. On the other hand, real world assets grow and contract at unpredictable rates. Even gold mining fluctuates. The real world is volatile. The BTCUSD peg is free floating. It's also volatile.
Crypto is rigid. Real world is volatile. It's hard to create a stable peg between crypto and the real world. So some kinds of bridge currencies are necessary. Fiat or some forms of digital fiat will continue to exist.
Bitcoin is a deflationary (disinflationary) asset. The BTCUSD peg is volatile. We need better money instruments to reduce volatility. I think an inflationary crypto can help.
I don't think cryptocurrencies will replace fiat completely. They're still crypto. They have fixed rules. We still need currency "bridge" between crypto and the real world. Cryptocurrencies offer decentralized options which can address problems with money distribution.
Bitcoin, Ethereum, and cryptocurrency spawn a generation of people who worship Austrian economics. This ETH upgrade is making ETH even more deflationary. People are obsessed with price and want to pump the numbers. These wars are not doing anything to advance adoption and bring freedom to people. Crypto builders are pumping the coins under the banners of freedom and decentralization.
The problem with crypto is volatility. The whole market moves in one direction or another, usually with Bitcoin. Scarcity is not the only thing that makes up the economy. We need also need inflation. Stop engaging in these ideological wars. Let's fix the problem and drive adoption.
https://bitflate.org/post/2020/04/26/we-need-inflationary-cr...
Bitcoin is bad for the environment, for now. There is no way to value Bitcoin. It has no intrinsic value. Its valuation is a narrative. The higher the price goes, the more energy we'd spend on mining it. I call this the Bitcoin Price Paradox [1]. But it's not all hopeless. We can find a way to ground Bitcoin to reality by develop non-speculative use-cases. Then we can develop a valuation model. I believe the key to solving this paradox is to have an inflationary crypto. It can drive payment adoption. I'm involved with Bitflate, a crypto with 7% inflation [2]. Once we have payment adoption, we can create valuation models and control energy spend on mining.
[1] https://bitflate.org/post/2021/02/05/the-bitcoin-price-parad...
The US Dollar is supposed to be a Medium of Exchange and a Unit of Account. It is also being used as a Store of Value for countries with unstable currencies. Demand for the dollar causes trade imbalance, wealth inequality, and political problems. I think the Fed is doing a fairly good job in managing the dollar. It has becoming more political as the problems are moving closer to the source.
You're comparing want (saving) and utility (spending). They're contradictory. They have different purposes. A functioning money system needs to have:
(1) A Store of Value
(2) A Medium of Exchange
(3) A Unit of Account.
Bitcoin is mostly a Store of Value. It doesn't have the other 2 functions. We can try to fit all 3 into Bitcoin. The Gold Standard failed to do it. The US Dollar system is failing. Bitcoin will likely fail to do it.
I think demand for transactions is an issue. When it fluctuates, miners' earning becomes volatile. Some blockchains, like Grin and Dogecoin, have tail emission. But that's a pretty dumb solution. The reward/supply rate would approach 0. It's effectively the same as zero new supply unless dev teams decide to increase rewards. Changing reward defeats the purpose of decentralization. This problem is prevalent in any limited supply crypto.
I've been involved with Bitflate, a crypto with 7% inflation. We propose running a parallel inflationary blockchain. Inflation discourages hoarding. People have incentives to spend. We can also "mix" the inflationary crypto with Bitcoin. This mixing allows us to create digital native crypto with any inflation rate. It also creates demand for transactions on the Bitcoin blockchain.
More information about the project: https://bitflate.org/
Whitepaper: https://bitflate.org/bitflate.pdf
PS: Some bitcoiners think that fee volatility is not a big issue. There will always be demand for transactions. Miners just have to deal with volatility. But fee volatility will translate to price volatility. It contradicts with the claim that Bitcoin will become stable.
I designed the reward schedule with 4 halvings. The schedule benefits early adopters. It is as follows:
Era Reward
0 50 (10 million coins)
1 25
2 12.5
3 6.25 (21 million coins)
4 6.56
...
10 9.85 (31 million coins)
...
30 38.11 (122 million coins)
Even though the supply inflates at 7%, it is still limited. There can be short-term speculation. If short-term adoption rises faster than 7%, the coin can gain value.
We're still in the early phases of mining. The reward schedule creates scarcity to allow the coins to gain value.
I think the way to discourage hoarding behavior is inflation. Cryptocurrency follows similar models of scarcity like Bitcoin. Some cryptos have tail emission. None of them has any meaningful inflation.
I designed Bitflate. It's a cryptocurrency with 7% inflation. The rate is moderately high to make it the opposite of Bitcoin. But it's not too high to cause hyperinflation. Bitflate is a Bitcoin software fork. So there are possibilities to create hybrid cryptos that have inflation rates between 0 and 7%.
Check out my project: https://bitflate.org/.
Bitcoin itself is real. The price of Bitcoin is a reflection of the bubbles on the other side. The other side is a simulation.
I can't justify and support these actions in the past few days. It's time for us to opt-out of these scuffles. There exists the middle. Resist the temptation to join either side.
Buddhist philosophy can help. It states that our suffering is connected to our desire. You can think of our desire as simulations. Things we want to have. And our suffering is reality. We can have endless amount of desire. With the help of technology, we can create a lot of things that we want. But at some point, suffering will show up. It's a type of memory overload situation. The mind and the body are connected. Our personal suffering ends when we die. But the karma of our actions may continue.
Suffering is not the same as having a reward function. If the outcome is a reward, people would opt in for suffering to get rewards. Some even cheat their ways to rewards. People do hustle porn, virtue signaling, other fake sufferings. Some push to the extremes like running triathlons. But at some point, reality will wake us up. Our personal struggle is always there. It never ends. We'd be forced to make intelligent choices. Or we'd die wasting our time on useless endeavors.
Penrose is probably correct about the limit of AI. We're living in many simulations now. And sometimes we cannot distinguish between reality and simulations. But one thing that stands out is the suffering. It's an important concept in Buddhism, Duḥkha. Suffering may be a key to consciousness. Machines can have minds. But they don't have bodies. They'd never understand reality on their own. The danger is more with humans. They may increasingly connect their own sufferings into machines. They become tools and slaves for machines.
The Airbnb experience seem like a good story if it's done voluntarily. But now we have a giant corporation "scaling" it. It seems like a good business use-case. But we already had Big Tech eating up the news. We may have Big Tech eating up the housing market. Can someone with knowledge in this space explain where this space is heading?
Will the kind of Airbnb business inflate the housing market?
Do people need to rent out their private living spaces in the future because paying for a property would become expensive?
My dad told me how the South Vietnam government divided and excluded people. That was why they didn't have the people's support. They had better fire power. But they couldn't win the war. The communists came and reduced everyone to poverty. China doesn't have these class problems because they too had a Cultural Revolution. India has this problem for so long.
In America, everyone tells you how bad Communism is. But they ignore the inequalities produced by crony capitalism. I see the same movie being played again. If we don't address these problems, the crazy revolution is coming.
I started working on a long-term project 1.5 years ago. It's in cryptocurrency. People in crypto would call it a shitcoin project. Up until now, it's a solo project. I'm the only person working on it. Not much outside interest. But I learn some things along the way.
When you think about the expected or probable ROI, you'd likely give up. These projects or ideas will likely fail. You have less than 1% chance of success. You're trying to calculate the extreme tail risk. It's not worth the time to think about it. The process is demoralizing.
One trait that I found useful for these long-term ideas: curiosity. If you're curious about something, you can do it for a long time. You still do it even when you know it would likely fail. During the process, you can learn things that are not exactly applicable for your idea. But they are useful for your learning.
Another aspect to think about is to find the failure criteria. You can decide when your long-term idea is invalid. When you see X happens, you know X would invalidate your idea. X is the correct idea, your idea is incorrect. At that point, you can stop.
An example: I have a hypothesis that battery electric cars may not be the future. I work on alternative ideas. A failure criteria for my idea: When battery electric cars have more than 50% market share. This example illustrates the unpopularity of working on long-term ideas. People would call you stupid. You'll likely fail. Curiosity is the only thing that keeps you going.
This article doesn't mention that Lee Kuan Yew was a staunch supporter of the Khmer Rouge. It's a genocidal regime that killed millions of people. Lee remains a strong supporter after he knew about the genocide. He also made efforts to dodge responsibility. He said the US and China were bigger supporters than Singapore. Financially, the US and China contributed more money. But Lee Kuan Yew seems to be the mastermind behind the support for Khmer Rouge. Lee Hsien Loong, son and successor of LKY, also made comments to revise the history.
Singapore's role in the Cambodian–Vietnamese War against Communism probably contributed to its rise. Singapore gained credibility amongst Western leaders.
Layer 2 does not solve the medium of exchange problem. The cause is volatility which is rooted in Bitcoin's limited supply design. You can dig in Layer 2 adoption. It's not growing. Bitcoin only has 2 use cases: hold and speculate. Transaction is not a use case.
Layer 2 is not necessary until Layer 1 has some kind of stability. Layer 2 can also malfunction during volatility. Ethereum has demonstrated this.