How Texas is becoming a Bitcoin mining hub

Re:How Texas is becoming a Bitcoin mining hub by ur-whale on Saturday February 12, 2022 @03:54PM (#30316330)

>Maybe I'm just not smart enough to understand BTC.

There is one aspect of BTC that IMO does not receive enough attention.

Can you think of any other asset that:

    1) strictly no one knows you own, yet you do own it absolutely, short of losing your mind or dying.

    2) can't be seized by anyone, especially if 1) holds true

    3) is highly likely (because of - among other things - finite, known-ahead-of-time supply) to preserve (or even increase) its value and therefore shields your wealth from erosion.

Bitcoin is not a perfect match for these requirements:

    for 1, you have to be a little careful how you acquire it and spend it (direct mining is the best way)
    for 2, you also have to be careful how you manage your keys
    for 3, you have to average out volatility over sizable stretches of time (~2 years)

Still, there isn't IMO anything around that fits the bill as close as BTC does.

A lot of people have a lot of negative things to say about BTC, but the fact remains: theses 3 properties are highly desirable, hence IMO the reason why BTC in such high demand.

All the negative arguments against BTC (power usage, ransomware, no intrinsic value, there's a million clones of it, unbearable volatility, can't be used as a currency, maxes out at 7 tps, miners will bail when rewards goes down, and all of the other "wont you think of the children" type arguments) don't carry much wait in the face of these 3 properties.

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Re:How Texas is becoming a Bitcoin mining hub by captn3m0 on Saturday February 12, 2022 @04:04PM (#30316451)

The majority of retail investors in BTC are not buying it for the above properties - they are buying it on exchanges that report to the taxman as a speculative asset. For these users, both 1 and 2 are not Satisfied (the bank knows you invest in crypto, and the exchange holds your crypto, you don’t have control over it). (3) is getting harder to claim every day but time will tell.

[ Parent | on HN ]

Re:How Texas is becoming a Bitcoin mining hub by ur-whale on Saturday February 12, 2022 @04:14PM (#30316550)

> they are buying it on exchanges that report to the taxman as a speculative asset

I believe you are correct for the vast majority of small retail crypto investors, and you are also correct that many of them are in a get-rich-quick type mindset. I feel sad for them, but ... there's no known cure for human nature.

But none of these arguments contradict the fact that the asset does have these desirable properties, and that it does create strong demand, especially from HNWI type investors.

As for 3) I disagree: it has always been very hard, and it's actually been much harder in the past.

A 30% downswing like the recent one is total peanuts compared to what happened in the early days. I seem to recall a time where it went from $30 down to $2 in a matter of weeks.

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