Is There a New Dotcom Bubble?

It's like saying cars are evil because robbers use them as getaway vehicles.

 

For example?

 

I’ve repeatedly given you examples over the years.

Here’s a very brief snapshot:

• To decentralise legal deeds, such as ownership rights to real estate, marriage certificates, passports, driving licenses, medical history, etc. Any data that needs to be made immutable can be done so via blockchain technology, and it can be done very cheaply and securely. It could also make the tokenisation of assets a reality allowing poor people to take joint ownership of assets that would have never been a possibility before.
  
  
• To streamline supply chains by stopping people counterfeiting goods; for ticketing events, to verify organs and other biological materials, etc.
  
  
• To help reduce carbon emissions by having a reliable ledger that can track and trace everything.
  
  
• To give data ownership back to the people which would return significant control that the technology companies currently have over our data. This would also allow individuals to monetise their data if they so wanted meaning they could directly profit rather than letting third parties have complete control, as it is now.
  
  
• An alternative way to store value that is easier than buying and storing gold.
  
  
• A significantly easier and cheaper way to transact currency globally that would reduce carbon emissions considerably. It would also make money “fairer” by taking away certain powers that central banks currently hold over all of our lives. We are at the whim of their decisions at all times with no say in the matter.
  
  
• It could help revolutionise the music industry by giving more power back to creatives.
  
  
• Decentralised finance where people can loan each other money rather than always having to go through a bank.
  
  
• To drive innovation in various sectors.
  
  
• To bank the unbanked, which is a huge problem in poor areas.

Crypto remains one of the fastest growing sectors, and adoption continues to grow at a faster rate than the internet did in the late 90s. It is attracting some of the smartest people on the planet because the scope of what’s possible is so enormous. Do not be fooled by a few biased headlines. SBF was a straight-up con man cut from the same cloth as people like Bernie Madoff, and his actions ultimately have nothing to do with the technology and innovation side of this industry.

 

I do not see how anyone can do that without government backing. Basically someone has to enforce all that and guarantee its authenticity. Who's going to do that? Who's going to enforce any breach of a contract?

 

That's my point. Governments will use it and already are in many instances, but there’s a very broad range of use cases that do not require any oversight because of the way smart contracts and NFTs work. Something like a driving licence should only need an authority at the point of issuance where it could be put onto something like Cardano so that you can validate its authenticity to anyone who asks to see it. It would make faking a licence almost impossible, and it would also be a lot cheaper.

One could prove ownership of a house, for example, via an approved smart contract blockchain. It's ultimately a way of cutting out a lot of unnecessary red tape, drastically reducing legal costs, and ushering in a new era of ownership.

Let's say, for example, that someone wanted to invest in real estate, but couldn't afford to buy or build anything outright. It would be much easier to tokenise ownership - in certain circumstances - so that a group of people could own an equal share allowing them to participate in a market they previously had no access to (it’s usually millionaires and billionaires). Many assets could be tokenised in this way levelling the playing field somewhat.

 

I do not see why governments would do that. Political decisions are not based on economic substance or common sense, but on sheer political interest. We - sadly - know a lot about that with the current Spanish government.

Why would a government make the public administration shrink? That would cost them millions of votes. They would lose any general election.

In Spain at least the administration is getting fatter and fatter, and all the ficticious "new jobs" are just friends getting unneeded positions at the public sector through connections. It's all nepotism and public spending. There's nothing substantial behind, no solid economic basis.

 

I think you’re overthinking this. Putting something like a driving license onto a blockchain is not a big deal, and times change and evolve. We are heading into a technological revolution and you can ignore it if you want, but that’s where we are heading.

The EU have GAIA-X which is a governance blockchain protocol that will likely have passports, licences, ID’s, etc, stored on there. Cardano is doing similar work in Africa and other nations.

This is all “crypto” technology.

Take a look at this fairly recent article:

Gaia-X moveID project demos decentralized identity, blockchain for cars

MoveID is a mobility identity project launched a year ago by 19 companies and led by Bosch. Now it is readying for its first demo event at Europe’s major auto fair, the IAA MOBILITY 2023, with six blockchain firms participating at the show.

The German government-backed initiative is under the umbrella of GAIA-X, the 350 EU member association for trusted data.

GAIA-X 4 moveID extensively uses self sovereign identity (SSI), as does the mother project GAIA-X, to safeguard data privacy and enable autonomous transactions with vehicles. Blockchain is used as a ‘vendor neutral infrastructure’ to support transactions between cars, traffic infrastructure and other service providers.

The MoveID group also includes Airbus, Continental who are not participating in this event, as well as seven blockchain firms Chainstep, peaq, Datarella, 51nodes, Ocean Protocol / BigChainDB, Fetch.ai, and deltaDAO.

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You can look into this stuff yourself. I’m invested in GAIA-X via Ocean Protocol as it uses their technology.

Here’s a snapshot from the GAIA-X website:




This is just one small example. There’s an entire industry that falls under the “crypto” umbrella that you don’t seem to know anything about, and I mean that in the nicest way possible because the vast majority of the general public have no clue either.

 

But you did not answer my question. How politicians are going to justify massive lay-offs in the public sector (specially since they are doing just the opposite: hiring people in the public sector to make unemployment data look better)?

Yesterday I was strolling around Barcelona and found Bitcoin promoted in grafitti. People must be really desperate to peddle it.

 

More restrictions:

Binance to Halt New UK Customers From Using Crypto Exchange - Bloomberg

 

It is enforced by miners. They are monetarily incentivised to keep the network secure. It is literally impossible to hack the network unless you acquire more than 51% of the mining pool, in which case, it would just make more sense not to destroy the network since you would make an insane amount of money by just keeping it secure.

Even in this scenario, the network can just be forked, which has happened several times already.

 

If massive layoffs were to come then they'd happen across society as a whole. Times are changing and things need to evolve with them, so it’s likely the job market will shift more towards programming/coding-based roles.

You are coming at this from a perspective of wanting it to fail which is blinding you from seeing its benefits. You have to try and be more balanced and source your information from various places as the Financial Times is a traditional finance readership. It’s like reading about the benefits of condoms from the Vatican.

Also, don’t forget that Bitcoin is still massively outperforming every other asset that is out there. If you had taken my advice in 2020 then you would have saved yourself a fortune in lost fiat value, and would have tripled what you had at today's price. I was very specific at the time and said those saving money in bank accounts are going to lose to inflation.

For someone that is so against the often bizarre decisions of the central banks, it seems counterintuitive to be so opposed to something that seeks to address some of those issues.

 

What about those people who lost their "key" to their crypto account?

Like that British chap who is looking for his old discarded computers or hard drives in a massive dump... because he had Bitcoin stored there, and his "key".

So who would take that political cost? Massive layoffs, redundancies, people who cannot adapt to those new roles you mention...

I still have not lost faith in the next banking / real estate crisis. What about people who invested in real estate? Aren't they better off than those who bought Bitcoin?

 

It's already happening, Juan. AI has already changed the job landscape, forever. I'm not sure what you're trying to ask/say. People have had to adapt to a changing society since the dawn of time. It’s like saying who’s going to light all the street lamps outside and what’s going to happen to their jobs? Some things just become redundant over time, but nobody knows what specific jobs are going to change right now as it’s too early to tell.

No. That’s an absurd notion. Properties have not increased 3x in value in the last 3 years, or circa 168x in the last 8 years.

We were talking about governance and data sharing networks at the time. Bitcoin is a different thing.

If you lose your keys, though, tough shit. It’s not difficult to back them up in various safe places. You can also use a hardware wallet like a Ledger or Trezor, etc

It’s fine to be sceptical of new concepts and ideas (in fact, it should be encouraged), but to hate something without basis is simply stupid. Read the white papers on some of the things we have discussed, and/or look at the peer reviewed literature. Don’t form your opinions based entirely upon stories you’ve read in the Financial Times, as I know that’s where you get all your crypto information from. Have an open mind and do the hard research yourself from an academic point-of-view.

 

For instance?

I read all the hype about AI but Google cannot tell me accurately if the next commuter train is going to be delayed.

Specifically about Bitcoin, why would any country back Bitcoin if central banks are going to launch their digital currencies?

 

I’ve already been over all this. It’s because CBDCs will remain in the control of the banks in a centralised manner. They can continue to manipulate and control the supply at their leisure without any input from the public.

For the sake of repeating myself, here’s a copy of my previous post on this:

They will eventually move to CBDCs. However, if you read the white papers on the current proposals, they are not good at all.

The central banks are creating their own CBDCs (central bank digital currencies). They will be nothing like the cryptos we have now because they will all be centralised and permissioned. Seven banks have been helping the BIS put together a CBDC template. These banks are:

• US Federal Reserve
• EU Central Bank
• Bank of England
• Bank of Japan
• Swiss National Bank
• Bank of Canada
• Swedish Central Bank

The central banks, governments, and certain institutions will use what they call wholesale CBDCs. The rest of us normal people will use a completely different digital currency to the people in power. It’s crazy. Their latest report also states that CBDCs would likely have wide-ranging impacts on public policy issues beyond a central banks traditional remit. That in itself is pretty concerning. It means they could potentially get involved in policy mandates that have nothing to do with money. They say different uses and needs would have to be addressed in the system's design. It also says this, “central banks might consider measures to influence or control CBDC adoption or use. This could include access criteria for permitted users.”



You can read more about this stuff here:

Central bank digital currencies: user needs and adoption

Central bank digital currencies: executive summary

If you’re honestly saying that AI won’t have an effect on the current job market, then you must be one of the only people who thinks this. It will change a lot of things, and it won’t all be for the better.

Returning to this question just briefly: it should be up to the people to ultimately decide. Why should governments get to decide for us when they are there to serve the will of the people? Then we have to question whether we live in a free society or if we are slaves to a fascist monetary system that wants to control us.

Why can't we have both? Liquidity moves from one side to another, so we know that you cannot create value out of thin air; the value has to come from somewhere. If people want to convert some of their fiat into Bitcoin as a hedge against inflation then why shouldn't they?

I still have my Visa crypto card where I can spend Bitcoin in any shop in the world.

 

It is unfortunately all about "Bitcoin hype" and that's all anyone can think of. Literal stakes of real estate, for example, would be a prime example. It is superior for anything requiring legal verification.

I do like Bitcoin on paper but investors ruined it as usual.

 

This doesn't make the network any less secure.

It's not hard to keep a record of your keys if you put in a little effort. You can buy a piece of metal designed specifically for this so it is fire and water resistant so you won't even lose it if your house burns down. Just buy two of those and put them in two different locations.

The people who lost their keys on old PCs did not expect Bitcoin to increase in value so much or they wouldn't have thrown them in the bin.

 

In the MSM it might be, but at an industry and investor level, it's not at all. People have been building groundbreaking technologies for years in this sector, and it's steadily moving towards a flashpoint where you will see some of them become mainstream seemingly out of nowhere. I feel like a broken record but look at some of the people who are involved. You have people like Silvio Micali, a lauded MIT Professor who has won numerous mathematics awards and the Turing Award (which is often referred to as the Nobel Prize of computing). The general calibre of those coming into this sector are of the highest order, but the press would have you believing it’s nothing but a bunch of degenerates. To be honest, about 90% or more are degenerates , but they are not what the smart investors focus on.

I’m not sure what you mean here as what you said doesn’t make sense to me. Can you reexplain what you’re trying to say?

 

Another crypto scam:

Cryptocurrency firms sued over ‘$1bn investor fraud’ by New York state | Cryptocurrencies | The Guardian

 

This is old news, @Juan, and what do you expect from people like the Winklevoss brothers? These scams are predominantly exchange-related the same as the SBF fiasco, Celcius, etc. Exchanges are like stock brokers rather than the stocks themselves. It’s like saying all stocks are a scam because a brokerage firm was found to be doing dodgy stuff in the stock market (which happens all the time). How many boiler room scams have there been? There has been a litany of scams from people like James Paul Lewis, Jordan Belfort, Bernard Ebbers, Michael de Guzman, Joseph Nacchio, Sam Israel, Barry Minkow, Kenneth Lay, Jeffry Skilling, Bernie Madoff, etc, etc. You also have major banks defrauding their own customers time and time again, one of the most recent being this:

So, why do you only post about crypto scams? It’s like you're trying to make a point without realising the magnitude of the scams that are occurring in tradional finance. Any system that has humans within it will all have scams going on, that’s just a fact of life.

Does the Guardian also report on the other scams, or is it just that you choose to ignore those stories? I hope it's not the latter as it means you are more prone to confirmation bias which is giving you the wrong picture of what real crypto is all about.

 

The Winklevoss brothers were some of the main promoters and advocates of cryptocurrencies.

About Bitcoin and other crypto, I do not know anyone who has made money out of it. Some of my friends "invested" and for a while they were making paper profits. All of them lost money. One of them actually was a victim of fraud.

 

So? There are loads of questionable people who support crypto just like there are loads of questionable people in traditional finance, etc. It doesn't mean a thing. Look at SBF; he also supported crypto. I haven't followed the FTX case in recent times, but Eric Wall - a well-known person in crypto - recently tweeted this:



This shows that it was even worse than most could have ever imagined. I never liked or trusted SBF from the get-go.

No disrespect, but your friends must be the worst investors of all time. How can one not make a profit on the best performing asset class of all time? I made tens of thousands from just a few grand in just one cycle (I could have sold everything for circa £80k at their peak). It sounds like your friends were maybe retail buyers who came in during the euphoria stage (when everything was already up 10 - 2000x) and then panic dumped everything when the inevitable crash came. I gave a warning of what would happen to uninformed late retail buyers in the investment section for Tinnitus Talk Benefactors. Everything I said happened as I said it would. Bitcoin has had a 80-90% drop every cycle, but this means nothing when it's up 30,000,000x to today's price. It's basic mathematics and understanding that an asset can have multiple 80-90% retraces and still be up circa 30,000,000x to the present price, or 69,000,000x to the ATH.



The red circles represent significant retraces up to 90%, but look at the overall trend.

All one had to do to profit was buy and hold. There was a good two year accumulation period to get in at exceptional prices during the last cycle on many great assets. I posted about them on here so everyone had a chance to make a fortune. I was largely ignored, though. Retail buyers only usually become interested when stuff is in the mainstream news and by then it's too late, because if anything, it's time to sell or hold for the long-term by that stage.

Time in the market beats timing the market.

That's unfortunate and I feel sorry for him/her. Previous cycles were like the Wild West, so one had to be tech savvy. Although, all the scams I came across were blatantly obvious and I never for the life of me could understand how anyone could fall for them.

 

Some of them were victims of a scam. Others said that there were commissions and charges to buy and sell, and also there's lots of volatility. It's not a safe investment.

Looks like a huge bubble.

 

It could be. That’s a fair assessment, but I don’t think it will be. At some point when there’s enough liquidity, it will settle out of the growth phase and I think it will behave more like gold or other assets of that nature.

You have to remember that the liquidity that’s in Bitcoin is a spit in the ocean compared to what’s in the S&P 500 or gold. Gold has a market cap of $13.15t whereas Bitcoin is currently at $580b, which is nothing compared to the M2 supply of money. It’s a tiny tiny fraction.

If it attracts the same kind of money as other key assets, which is much more likely once a US ETF is announced, it is possible that Bitcoin could eventually hit a price of around $3m - $6m. It’s all if buts and maybes, but that’s what all investments ultimately are, and what attracts people to crypto is the very high risk-to-reward ratio. It’s the only asset class that could potentially turn a small amount of money into a very significant amount of money. For example, a friend of mine turned £1000 into £400,000 last cycle. The risk to reward on those kinds of gains is absolutely worth it. Losing a grand is not the end of the world, but watching £1k turn into £400k is life-changing. Only crypto can potentially do this kind of thing, but the exponential gains will not last forever (and they are decreasing with each cycle), and once enough liquidity comes in, it will become more like the stock market.

There’s a spread just like with any stock broker. It's cheaper to buy crypto than it is to buy stock, and there are lower limits. Your friends are misinforming you. The volatility is the best part! The volatility is what makes such huge gains possible, and it happens because the liquidity is much lower than S&P 100 stocks, for example. The moment that advantage goes means we’ll no longer be in the growth phase, and the risk-to-reward ratio will plummet.

I happily took what people perceived as risky and took advantage of what I saw as a golden opportunity. I based my decisions on hard data as every single metric was screaming “buy,” and I spent hours upon hours researching. Those listening to the MSM narrative got robbed of the opportunity.

 

Make Amazon Pay sounds pretty good. The company has to be held accountable, and pay all the avoided taxes due in Europe.

Exhausted Amazon staff fight back against retail giant at global UK summit | Amazon | The Guardian

 

The dark side of Big Tech: constant scams.

Booking.com customers targeted by scam ‘confirmation’ emails | Scams | The Guardian

 

I wouldn't consider Booking.com to be “big tech.” They are a hotel booking site/travel agent. In fact, my wife and I used them to book parts of our honeymoon.

Scams are prevalent in every industry.

 

I still do not see the "AI boom" anywhere. Commuter trains keep breaking up all the time, and keep coming delayed, and Google consistently fails on predicting it, and, even worse, updating train information that is available on screens at the stations and also over the PA system...

So much for AI.

Google Cloud revenue misses expectations despite AI boom | Alphabet | The Guardian

AI works in an "interesting" way:

Instagram apologises for adding ‘terrorist’ to some Palestinian user profiles | Instagram | The Guardian

 

Just for general information... apparently Google has an "Appeals Department" that reviews again your genuine reviews of businesses, restaurants, bars, shops and institutions on Google Maps, after they are unilaterally deleted by Google, applying censorship to boost the score of restaurants, bars etc.

This means the reviews you are reading online on Google Maps are totally cooked, manipulated and altered.

 

All the fun was in the small print... but now... "poor" PayPal:

FCA acts against PayPal and QVC as more Britons turn to buy now, pay later | Borrowing & debt | The Guardian