RE: Operation white elephant: Five reasons why Satoshi could have deserted Bitcoins to create Bitcoin Cash @BlockRush
I would not call this exactly a ponzi, but its clear its more speculative value, or based on hype, or various scheme, more than price like regular investment for technology or innovation value.
The whole scene of crypto trading always look weird to me, compared to classic investment on technology or companies.
Im not sure not 1% of people who trade them can really tell what they are about on technical ground, or what kind of buisness model they count on to make return on investment, what kind of income it can make, and how much, and that sort of thing that make the solid fundation for classic investment.
All is anonymous, and there us still not much perspective or torought examination of the perspective of development and buisness, other than other people will buy it at higher price, or it will rise by some kind of sorcecery lol
I know currencies i trade more or less. That is why i was wondering why people praise the technology that much, and say this is the main thing why they invest, and the other day that value drops so much when a new one is created. I believe Current price of BCH reflects the technology factor, and the difference from BTC price is all hype, anticipation and schemes if i can say so.
Yes, i would believe this too :) And eventually still some hype and scheme on bch too, but to a lesser degree than btc :)
I think people praise the technology as some sort of hype, without truly understanding it, its limitation, the time / cost for development to fix them, and the whole ecosystem, and what is really at stake with it.
To me it looks more and more the technology aspect become more a pretext to over inflate speculative bubble, and seen as really cheap kind of research compared to if you would invest in any other kind of software or technology.
If i want to get really cynical, i'd even say it's more to give the impression to people they are doing some real trading and research works, while just feeding vague technical terms and vague prospective, without giving real numbers, and timing, and market target and some real clear stuff, just a sort of psychological hook to make people feel like they are serious trader, but actually still much easier and layman than it really looks like on the surface for most people.
It looks easier and more liberal because there is no restriction and regulation, and looks like some kind of unleashing of economic potential for small layman investor, but i'm not sure of what's the real dynamic behind, and if there is really that much real economic value added with all the different forks and coin compared to the market cap it reach.
Without counting all the scam and shady operator that also manage to inflate the price by making people buy things through shady portals or periphal scheme that probably contribute in pumping the price to a degree.
I mean if you really want to put this in perspective with classic investment scheme, it would be like a company borrowing idk 3 billions $ of market cap, and then needing to make more than 3 billions of benefits, without counting this 3 billions of investment, so 3 billions $ of pure profits completely seperated from the currency investment for it to be actually profitable.
Even if bitcoin reach mass adoption, then it mean e-shop or real value seller would accept the coin, but then , they will just install a node for free, pay third party developper to develop e-shop apps based on the node, and pay zero to the bitcoin, they will not buy bitcoin at higher price in order to use the service, so idk how there can be a real return on the price of the coin itself.
Well it's still different from classic investment scheme in the sense the money is not that the disposal of a company to pay infrastructure of development or marketing, people still own their coin and they are locked in their wallet as their property, not like they own share in a company giving liquity to a team of developer like a company, so it can't really devaluate on its own.
But i have hard time to see how there can be a real return on investment on the bitcoin price based on real economy use, as there is nothing really to sell to companies or entrepreneur, no product to be bought, third party company can use all the software for free, and make third party app without having to buy btc at higher price.
Maybe there can be some profit made by operating nodes and collecting fee with lightning network, but even this the profit is still made on the already existing capital, by taking a fee on the transaction going through the node, not by buying more btc at higher price.
Well to me the whole model looks a bit weird.
As long as it's really seen as a store of value like saving, that can rise because more people buy it at higher price because of the stability of the value as a saving, i don't think there is actually much risk of devaluation, but i have hard time to see how the real market profits can even remotely match the market cap.
That is exactly what i wanted to say. IF BTC was for storing value with actually limited supply it would be a nice tool to store it. BUT. It's forking so essentially you have double the amount circulating. That could fork again and again and again. Thus making it not viable for storing value as it has unlimited supply. Like federal reserve printing money.
BTC BC is not meant to be making money. It's an archaic and simple BC as it is the first one. It was said it is good for transferring value but is slowing down significantly hence LTC would be much better candidate for that. Could be a good fit for storing it but again supply has doubled and WILL multi fold.
If it HAD limited supply, the price would have potential to grow and capital gains would be incentive to BTC holders to work on it (PROFIT) but now i am not sure. Unless they would make algorithm flawless in time and all forked ones would die off which is UNLIKELY.