Bitcoin and Crypto Thread

[Australia Sucks]

As has been shown mathematically already, the forced tax events that one gets by having to declare dividends renders them worse investments than other "growth" stocks, which in a way, those same commodity stocks would be if they didn't pay the dividend. You wouldn't trade dividends and/or forced sales for something you didn't also expect to appreciate over time, proving my point. If you think about it, and you were older for example and didn't want to have as much risk (thus buying the dividend stock), you'd just buy bonds.

Talking about the tax situation is opening up a whole other can of worms as there are so many variables. It depends which country you live in, your personal income levels, if the stocks are in a retirement account, trust or in your personal name and a whole host of other factors. But yes I do understand the point your a making which is somewhat valid.

In general for most Americans growth stocks will be more tax efficient when they are accumulating assets but during the retirement phase tax wise there may not be much difference because they would need to sell down some stocks periodically to pay their bills so at that point there is not much different between dividends stocks and growth stocks (from a tax perspective).

As for buying bonds no sensible person is buying bonds in this day and age due to the endless inflation. These days the typical large corporation has enough market dominance and pricing power to be able to pass on cost increases and then some and thus can boost profits and dividends in an inflationary environment therefore your dividend from a solid major corporation should increase over time to hedge some of your inflation risk whereas with bonds your inflation adjusted income (and capital) will get decimated over time because real interest rates are too low due to financial repression.

Also the American tax system favours growth stocks and share buybacks over dividends but that is not the case in every country. For example in Australia we are one of 3 countries that has full tax imputation credits (in Australia these are called franking credits) attached to dividends to avoid double taxation whereas capital gains is effectively double taxed at least in a indirect manner because the company pays tax on earnings which are retained to grow the company and increase the share price then you pay capital gains when you sell the shares. This is why in Australia for example companies have much higher dividend payout ratios on average than American companies.

Australia, Malta and New Zealand have full dividend imputation systems with the U.K., Canada and South Korea having partial imputation systems for dividends.

Besides even the value of growth stocks is theoretically underpinned by dividends if you go back to stuff written by guys like John Burr Williams (who wrote the theory of investment value) etc. Most growth stocks eventually get to a point of maturity where they start paying at least some dividends. These days even Alphabet, Apple, Microsoft, etc all pay dividends. So even a growth stock which does not currently pay a dividend (e.g. Berkshire Hathaway) theoretical valuation is underpinned by the fact that they could and likely will pay dividend at some point in the future.

 

[JayR]

Reposting from the J6 thread.:

 

[Blade Runner]

We've officially reached the point in the cycle where Bitcoin maxis are so euphoric they start talking like comic book supervillains.

Not really, we're nowhere near ATHs (for this year).

At what price of USD (since you are the fiat guy) will you finally come to terms with BTC being here to stay? It's a curious thing, as I suspect that even with a $500k tag, whatever that means to you, you'll still be anti BTC.

 

[scorpion]

At what price of USD (since you are the fiat guy) will you finally come to terms with BTC being here to stay? It's a curious thing, as I suspect that even with a $500k tag, whatever that means to you, you'll still be anti BTC.

Well, that's the thing: I don't have to "come to terms" with Bitcoin. I don't have to "bend the knee" to it. I don't have to "get Bitcoin at the price I deserve." I don't have to do any of those things, because Bitcoin is completely irrelevant to the real economy and always will be. It's a sideshow. It's a cult. I don't need to own it, even if it remains "here to stay" as a speculative commodity. If you and others like you continue to be obsessed by this bizarre multiplayer computer game in which you exchange dollars among one another for entries on a shared ledger, so be it. Who knows how long such madness can continue or to what heights it may escalate? In the meanwhile, I will continue to own real assets that produce real cash flows and have real economic value. Regardless of what price Bitcoin climbs to in the years to come, I am quite confident that its long term value is zero. It is a fad that will be ultimately peter out and be marveled at by future generations as an example of the limitless greed and stupidity of human beings, and will doubtless replace tulip bulbs as the foremost historical example of speculative financial manias. I mean, in that regard it's pretty hard to beat people paying $100k for what amounts to nothing more than entry on a spreadsheet.

If it is your contention that I am wrong and that one day I will be obligated to own Bitcoin in some capacity in order to simply go about my life and business, I would argue that you should strongly consider the parallels that such an outcome would share with the prophesied Mark of the Beast, and ask yourself why you choose to advocate so zealously for such a Satanic development.

 

[GodfatherPartTwo]

Well, that's the thing: I don't have to "come to terms" with Bitcoin. I don't have to "bend the knee" to it. I don't have to "get Bitcoin at the price I deserve." I don't have to do any of those things, because Bitcoin is completely irrelevant to the real economy and always will be. It's a sideshow. It's a cult. I don't need to own it, even if it remains "here to stay" as a speculative commodity. If you and others like you continue to be obsessed by this bizarre multiplayer computer game in which you exchange dollars among one another for entries on a shared ledger, so be it. Who knows how long such madness can continue or to what heights it may escalate? In the meanwhile, I will continue to own real assets that produce real cash flows and have real economic value. Regardless of what price Bitcoin climbs to in the years to come, I am quite confident that its long term value is zero. It is a fad that will be ultimately peter out and be marveled at by future generations as an example of the limitless greed and stupidity of human beings, and will doubtless replace tulip bulbs as the foremost historical example of speculative financial manias. I mean, in that regard it's pretty hard to beat people paying $100k for what amounts to nothing more than entry on a spreadsheet.

If it is your contention that I am wrong and that one day I will be obligated to own Bitcoin in some capacity in order to simply go about my life and business, I would argue that you should strongly consider the parallels that such an outcome would share with the prophesied Mark of the Beast, and ask yourself why you choose to advocate so zealously for such a Satanic development.

I hear your arguments that BTC is not a real asset, that it is not intrinsically valuable, that it is backed up by the power of belief, etc. I agree with that. So what do you think it would take for the power of belief to be stripped away from BTC? Will people ever stop believing in it? Because as long as people continue to believe in it, then some people at the top continue to get richer while the rest are still trying to catch up.

 

[Australia Sucks]

Well, that's the thing: I don't have to "come to terms" with Bitcoin. I don't have to "bend the knee" to it. I don't have to "get Bitcoin at the price I deserve." I don't have to do any of those things, because Bitcoin is completely irrelevant to the real economy and always will be. It's a sideshow. It's a cult. I don't need to own it, even if it remains "here to stay" as a speculative commodity. If you and others like you continue to be obsessed by this bizarre multiplayer computer game in which you exchange dollars among one another for entries on a shared ledger, so be it. Who knows how long such madness can continue or to what heights it may escalate? In the meanwhile, I will continue to own real assets that produce real cash flows and have real economic value. Regardless of what price Bitcoin climbs to in the years to come, I am quite confident that its long term value is zero. It is a fad that will be ultimately peter out and be marveled at by future generations as an example of the limitless greed and stupidity of human beings, and will doubtless replace tulip bulbs as the foremost historical example of speculative financial manias. I mean, in that regard it's pretty hard to beat people paying $100k for what amounts to nothing more than entry on a spreadsheet.

If it is your contention that I am wrong and that one day I will be obligated to own Bitcoin in some capacity in order to simply go about my life and business, I would argue that you should strongly consider the parallels that such an outcome would share with the prophesied Mark of the Beast, and ask yourself why you choose to advocate so zealously for such a Satanic development.

Again Bitcoin is a form of money.

Real assets are good but the point that you seem to be missing is most people need to keep a percentage of their assets in money for liquidity, etc. Now if for example you have 5% of your assets liquid in some form of money would you rather hold U.S. dollars or Swiss Francs or Gold or Bitcoin, etc. For a lot of people they would rather keep that liquidity portion of their portfolio in Bitcoin because its superior to fiat. Its not an either or between Bitcoin and productive assets. Just in the same way as its not an either or between owning stocks and real estate or owning U.S. dollars. I would argue that for a lot of people Bitcoin could replace some of the U.S. dollars they hold for liquidity.

Also people can have more than one source of liquidity for their portfolio.

For example in Argentina people who have some level of savings typically hold only enough Argentinian pesos for a few weeks worth of expenses and the rest of their cash reserves are kept in U.S. dollars or U.S. dollar stable coins which have a much lower inflation rate than Argentinian pesos. Then the even longer term assets might be held in real estate or something else.

Americans can do the same with Bitcoin. You can keep a portion of your liquidity that you need more immediately in U.S. dollars and keep the rest in Bitcoin which has a lower inflation rate than U.S. dollars.

 

[Australia Sucks]

I mean, in that regard it's pretty hard to beat people paying $100k for what amounts to nothing more than entry on a spreadsheet.

You don't see the irony in the fact that a much larger percentage of people will trade a years worth of their labour in a corporate job to earn $100,000 US dollars which are also just an entry on a spreadsheet given that 90% of U.S. dollars are not even physical cash.

At the end of the day something needs to be money and I would rather that something become Bitcoin than to remain as U.S. dollars.

 

[Australia Sucks]

If it is your contention that I am wrong and that one day I will be obligated to own Bitcoin in some capacity in order to simply go about my life and business, I would argue that you should strongly consider the parallels that such an outcome would share with the prophesied Mark of the Beast, and ask yourself why you choose to advocate so zealously for such a Satanic development.

Fiat is even more satanic than Bitcoin because its easier for the elites to control. Just ask the Canadian truckers who had their bank accounts shut down or Nigel Farage who got de-banked.

 

[chance vought]

Fiat is even more satanic than Bitcoin because its easier for the elites to control. Just ask the Canadian truckers who had their bank accounts shut down or Nigel Farage who got de-banked.

Exactly: Fiat is the "Mark of the Beast" where you must beg for permission to use it, or else: Take the vax, "what are the source of these funds?", don't donate to the wrong people, don't make mean tweets, hate speech, etc. Literally ANYONE can use Bitcoin WITHOUT PERMISSION.

 

[Blade Runner]

If it is your contention that I am wrong and that one day I will be obligated to own Bitcoin in some capacity in order to simply go about my life and business

No one is technically obligated to do anything, and certainly I'm not for them to be obligated, as I am a freedom loving person. Even in the case of the "mark" you quote after this line, you wouldn't be obligated to do anything, but the price you might pay might be much higher.

Where one might attack the semantics would be the use of the word for a rational person. It is simply irrational to sit by and be debased by the government, or choose other "assets" that are not doing as well, just because you have some unrealistic belief (and it is, as all BTC does is increase in value compared to all fiat over time, and even compared to all other assets) that BTC isn't "valuable." I just point out this delusion.

Think of it! Guys like Peter Schiff, and apparently you (you tell me if this is true), will still be saying at BTC $500k or $1M, "It's worthless!" That's just amazing to me, and that's just on pure price. There are many other reasons we've pointed out why it is worth far more, and the network is increasing in size and hash, obviously contributing to its value.

Because as long as people continue to believe in it, then some people at the top continue to get richer while the rest are still trying to catch up.

This is what is so contradictory, and Australia points it out below. It's really the death blow to all of scorpion's arguments, too. People will also continue to believe in the USD ... until they don't. And we know that will happen eventually. But what makes that worse is that the US is stealing from all those who "believe" in the USD, with debt, inflation, debasement etc.

One of the things going on that you guys haven't figured out yet apparently, is that we aren't technically getting richer, we're just not losing like you all are. When you couple that with the way an economy should work, which is deflation and increased standard of living over time, it appears we are getting much "richer", yes.

For a lot of people they would rather keep that liquidity portion of their portfolio in Bitcoin because its superior to fiat. Its not an either or between Bitcoin and productive assets. Just in the same way as its not an either or between owning stocks and real estate or owning U.S. dollars. I would argue that for a lot of people Bitcoin could replace some of the U.S. dollars they hold for liquidity.

Precisely. And even if you think we are all crazy for allocation of %X to our portfolio, all we have recommended to others is just stop kicking at the goads like a person who can't do math, and get off zero. But the naysayers here are too egotistical and proud to just admit that they have been wrong. What's sad is that they'll continue to pay for their insolence.

You don't see the irony in the fact that a much larger percentage of people will trade a years worth of their labour in a corporate job to earn $100,000 US dollars which are also just an entry on a spreadsheet given that 90% of U.S. dollars are not even physical cash.

Amazing, this is what truly is the game.set.match in our argument.

 

[scorpion]

Fiat is even more satanic than Bitcoin because its easier for the elites to control. Just ask the Canadian truckers who had their bank accounts shut down or Nigel Farage who got de-banked.

Exactly: Fiat is the "Mark of the Beast" where you must beg for permission to use it, or else: Take the vax, "what are the source of these funds?", don't donate to the wrong people, don't make mean tweets, hate speech, etc. Literally ANYONE can use Bitcoin WITHOUT PERMISSION.

Canada Sanctions 34 Crypto Wallets Tied to Trucker 'Freedom Convoy'

Federal police agencies, working with the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), are investigating cryptocurrency donations supporting the weeks-long protest against Canada’s vaccine mandate. The protests are now deemed illegal under the Emergencies Act invoked...

www.coindesk.com

Police have turned crypto seized from trucker convoy over to escrow agent, court told

Donations to the so-called 'freedom convoy' have totalled more than 22 bitcoin, worth in excess of $1.1 million

financialpost.com

Did you guys miss this story? I'm not sure where this idea that Bitcoin is outside of government control comes from. It's very easy to trace Bitcoin transactions since the ledger is public, and the government obviously has control over the on/off ramps to traditional financial institutions/fiat conversion. Not to mention the fact that they can literally kidnap you and just throw you in a cage without trial if they really have it out for you (see: J6 prisoners). As long as you remain under the physical jurisdiction of any government, they can pretty much do whatever they want to your Bitcoin, just like they can to a traditional bank account.

 

[Blade Runner]

Did you guys miss this story?

No, we didn't. They were using centralized actors as their custodians, not p2p as BTC is made for. Even in the case of seed phrases and threat of physical violence mentioned, that is something about life that can never be fully done away with. However, one of the differences is that you can't do that kind of thing at scale, especially in a dying government system that lashes out. With (government controlled/interested) banks you can absolutely do it at scale and at will.

There are still other options and will be more technology moving ahead. While the public ledger makes some aspects of the BTC network more transparent and susceptible to incomplete anonymity, this same aspect makes it the best in savings technology as it can be audited. Tradeoffs, another reality of life.

 

[Judoka]

The Trump crypto coin is a scam. But my crypto coin is not a scam. It has unique characteristics. It's special.

 

[chance vought]

The Trump crypto coin is a scam. But my crypto coin is not a scam. It has unique characteristics. It's special.

all crypto is a scam

 

[Blade Runner]

But my crypto coin is not a scam. It has unique characteristics. It's special.

Do you understand why BTC isn't "crypto"? It's also not a currency.

 

[scorpion]

I hear your arguments that BTC is not a real asset, that it is not intrinsically valuable, that it is backed up by the power of belief, etc. I agree with that. So what do you think it would take for the power of belief to be stripped away from BTC? Will people ever stop believing in it? Because as long as people continue to believe in it, then some people at the top continue to get richer while the rest are still trying to catch up.

There are really just so many problems with Bitcoin long term. First of all, it's technology. It's software. And technology is in a constant state of flux and improvement. Bitcoin has already been technologically improved upon substantially by other cryptos, and if cryptocurrency actually does manage to stick around as a concept, there is no reason to think that Bitcoin will remain preeminent decades into the future, especially as its mining rewards decrease towards nothingness. I mean, who is running copies of Windows 95 anymore?

Bitcoin maxis claim that Bitcoin is "the discovery of money" or "true digital scarcity", but Bitcoin is really just a game. It is literally a multiplayer computer game in which people trade and mine Bitcoins. That's it. It has no connection whatsoever to the real world, and it never will, because it is utterly useless as an asset. If you owned every stock in the world, you would control the entire world economy. If you owned every Bitcoin in the world, you would own a spreadsheet of randomized alphanumeric characters. The longer the game of Bitcoin goes on and more coins are lost or concentrated into fewer hands, the more irrelevant Bitcoin becomes. Since Bitcoin has no connection to the real world, people can simply choose to stop playing the Bitcoin game and suffer zero consequence.

And in the short term, the more expensive Bitcoin becomes, the less potential there is for future gains. Bitcoin's percentage gains look impressive when you start from pennies, but not so much when already you're in the six-figures. And this matters because the only reason to buy Bitcoin is because the price goes up. That's it. And if the price doesn't go up enough to keep people excited about HODLing, they will eventually get bored and sell. Boredom may ultimately kill Bitcoin since it's essentially a cult. This is why Bitcoin maxis are so sensitive to criticism and are trained to response with the same well-worn phrases and talking points. There is a religious element to it, as if they're repeating catechisms and Bible verses in the face of a demon questioning their faith. It's very evident just perusing this thread.

There is a striking and universal feature among active, zealous members of cults: not a single one of them recognizes that they are, in fact, in a cult. Having had their identity and thinking absorbed so fully by the teachings of the cult, they are literally mentally and psychologically unable to objectively analyze their own situation, much less their own thinking. They have been completely subsumed by the cult. You see this very clearly with Bitcoin maxis, who have been captured by these bizarre, fantastical beliefs that the world economy will soon revolve around Bitcoin and that they, as Bitcoin HODLers, will become members of the new economic elite. Why the current economic elite, who control most of the assets on the planet, would happily hand them over in exchange for entries on a distributed spreadsheet is never really explained. "It's just inevitable," they say. "All will bend the knee to Bitcoin!"

The entire thing is quite preposterous, and the only thing Bitcoin really has going for it is its price (which is heavily manipulated by whales wash trading their positions and Tether acting as Bitcoin's unofficial Federal Reserve). Since Bitcoin has no actual value proposition and lives and dies entirely by hype and hot air, it has no price floor. Its final collapse will be sudden and devastating. Many people will be utterly ruined. Some will even kill themselves. It will be very ugly. But such is the way that greed and hubris are always punished.

 

[JayR]

There is a striking and universal feature among active, zealous members of cults: not a single one of them recognizes that they are, in fact, in a cult.

But doesn't a cult, by definition, need to have a single, "charismatic" leader who manipulates his followers? Bitcoin doesn't have this.

 

[PurpleUrkel]

Give it up guys, Scorpion is doing God's work and running circles around your JQ-inspired financial logic.

Grow up, stop playing video games for a "living," its time to get outside and get your hands dirty.

"Money, money, money, gobble, gobble, gobble, jew, jew, jew... Bitcoin, crypto, electricity, internet, computers, so much better than sportsball!"

 

[scorpion]

But doesn't a cult, by definition, need to have a single, "charismatic" leader who manipulates his followers? Bitcoin doesn't have this.

No, what you're describing is a specific type of cult: a cult of personality. But cults can and do exist in other forms. They don't have to have identifiable leaders or even organizational structures. For modern examples, look at the movements behind climate change/green energy, veganism and transgenderism. These are all cults similar to Bitcoin, with extremely zealous adherents who often devote their entire lives to spreading the cult's message, usually to their own eventual personal detriment (i.e. vegans becoming malnourished, trans people chopping their sexual organs off and killing themselves, etc...). The more deeply people are drawn into the cult, the less they are even able to recognize that their thinking has been captured, and the more zealous they become in defending the cult itself, since they can no longer make a psychological distinction between the cult and themselves as individuals. To criticize the cult is therefore to criticize them personally, and they become emotional and hyper defensive in response. A less extreme example of this type of cult is the modern multi-level marketing scheme (i.e. Amway, Herbalife, Avon), where a person is recruited and promised great financial rewards if they can "build a business" by essentially monetizing all of their personal relationships and convincing everyone they know to either buy the products or to also join the cult and begin selling the products themselves.

Bitcoin is unique in that it is a distributed cult without a leader that emerged organically, and which is both utopian and financial in nature. Bitcoin cultists believe all at once that Bitcoin is a technology/discovery that will change and revolutionize the world, that it is a moral imperative to address the inequities of the current financial system, and that it is something that will (conveniently) serve to make them fabulously wealthy in the near future. In this regard, the message is certainly very appealing and one can easily understand how so many people are suckered in by it. But just like the other examples of modern cults I provided, the core beliefs underlying Bitcoin, however earnest and well-intended they may be, are built on misunderstanding and delusion.

 

[chance vought]

Bitcoin is software - also a network, that is upgraded constantly since its inception. Just like TCP-IP has been updated over time to be more efficient. Nothing has replaced TCP-IP because doing so would mean destroying arguably the most valuable network humanity has ever built, and rebuilding a new one from nothing.

Bitcoin is the most valuable distributed network of money. It already has accrued the most value of that type of network. The chances of some "better bitcoin" replacing the Bitcoin network are close to 0. The free market will decide whether to change bitcoin, use bitcoin, or choose some shipcoin. So far, everyone who chose bitcoin has been rewarded. Everyone who has bitcoin decides every day whether they want to change bitcoin, hold it, or sell it for something else.

Just because you don't value it, doesn't mean it has no value. Everything has the value that humans place on it - water has no value to someone who lives at a lake, but is worth more than its weight in gold to someone in the middle of the Sahara. Get this "intrinsic value" BS out of your head.