Let's Talk Solomon's Points: Has Bitcoin been captured and what is going on? \ stacker news ~bitcoin

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Let's Talk Solomon's Points: Has Bitcoin been captured and what is going on?

2215 sats \ 18 comments \ @028559d218 5 Jun bitcoin

zaps forwarded to @Solomonsatoshi (50%)

Here is Solomon's response to my post "Obvious question is Obvious: Where the hell is everyone???"... (My post: #997414) (Solomon's Response: #997735)

Solomon:

Yes but they and corporate Treasury usage and hodling now account for the vast majority of use. Sweet FA of us still hope and want to use Bitcoin as a MoE...and when we do we are rarely able to do so in compliance with the law....that's no accident! Bitcoin MoE use has been successfully, and very slyly OBSTRUCTED and prevented from posing any real threat to fiats MoE hegemony. The result is that Bitcoin is not sustainable long term. Bitcoin with its reducing block subsidy can only ever be sustainable long term if it develops to provision mass scale MoE. Traditional payments providers charge 1-3%- Bitcoin does not need to charge that but it does need a growing demand for onchain transactions to support a healthy mining community long term. The development of that MoE growth has been slyly but determinedly blocked. As a stack and hoard SoV/speculative commodity there will not be enough miner revenue generated to preserve the security of the protocol as block subsidies decline. Bitcoin will decline inevitably, the way things are going, if its failure to gain mass scale MoE adoption continues.

Is he right?

He also posts (#997733)

Network effect has been blocked. You ignore this out of arrogance or ignorance. Bitcoin has been redefined into a harmless speculative commodity plaything held and controlled increasingly by bankers and only used as a MoE on the very margins and almost always outside the the law.

Has Bitcoin been 'blocked'? I have several thoughts on this as it's important to me. Which explanation is the "correct" one???

[Option 1]

We are 'early' to Bitcoin at least as a MoE. YES the 'silk road' days had Bitcoin used as a medium of exchange... but the MoE tools of today ie with Lightning are far superior. The liquidity is better, the wallets are better, and Lightning enables relative privacy with cheap and instant transactions which people want anyway...

So people will 'figure it out' eventually?

[Option 2]

We may be 'early' but... people will never really want Bitcoin as a MoE. All they want is more dollars/yen/Euros etc... the paper money. Therefore holding an ETF and "watching it go up" is good enough for most people because they can sell the shares for cash. Re-hypothecation risk and 'rug-pull' risk is unimportant because you can just... trust the exchange and 'cash' out into your favorite fiat whenever?

Even if people 'figure it out' they won't want self-custody even if it's really cheap... because people are LAZY MFs.

[Option 3]

We are not 'early' to MoE. We are not 'early' to SoV for global payments or even "corporate treasuries" because it 'won't matter' anyway...

3a) Because Bitcoin has basically failed network-wise? MoE has failed and SoV will ultimately fail because "falling block rewards" means that miners have no long-term incentives to keep mining. So the "network security" will fail as well regardless of Bitcoin "adoption" by corporate treasuries... no network awards no mining rewards no network in the long term.

Is THAT correct???

[Option 4 the black pill]

Because of some combinations of 2, 3, and 4... [?] Bitcoin will continue to 'go up' in the short or medium term... but only as it doesn't threaten the stability or demand for US Treasury bonds. Then it will be seized if held on exchanges or in ETFs... and the government will never allow something else to 'supplant' demand for Fiat in any meaningful way and Bitcoin peer to peer will be severely marginalized.

Or that's all total Bullshit?

We therefore aren't waiting for people to "figure it out" they are too lazy. Or even if they aren't 'too lazy' it's too late for them. And even if they could figure it out people just aren't interested because they rather watch "the news" on TV and 'get more fiat'?

What exactly is going on here?

Or perhaps... things will "work out" OK but we just need more time? People need more 'education' to come to real Bitcoin usage?

Is @Solomonsatoshi Right? Are we ******? Or do we just need more education and time for MoE use to flourish in Bitcoin?

Are we waiting for the "killer app" or what?

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74 sats \ 1 reply \ @standardcrypto 12h

I disagree with the black pill view, but I do think 3a merits thought moving forward.

("falling block rewards" means that miners have no long-term incentives to keep mining. So the "network security" will fail as well")

I'm interested in exploring failure modes, AND success modes, stemming from this dilemma that bitcoin must either overcome or succumb to.

On the success path, I like what @justin_shocknet said "Real chain-activity MoE is when institutions use it like they do wires today, still a decade out or more."

So maybe it's a race between something along these lines, and the security budget getting unbalanced in a way that makes bitcoin vulnerable.

49 sats \ 0 replies \ @028559d218 OP 3h

8 billion people, 200 million companies, in 70 different countries... we should have large-scale, powerful demand for blockspace as far as the eye can see.

so when we have half-empty blocks it leaves me scratching my head. begs the question where is everyone...

121 sats \ 4 replies \ @optimism 6 Jun

Sweet FA of us still hope and want to use Bitcoin as a MoE...and when we do we are rarely able to do so in compliance with the law....that's no accident!

This really depends on where you live and what you spend your hard earned money on. I'm personally relying less and less on fiat and this year have thus far transacted more in both volume and value in sats than in local currency, while discounting exchange-to-fiat and SN activity. I don't think any of my transactions are illegal.

I agree with you that because of regulatary obstruction and influential people spreading their FUD, society is using sats as MoE less than what is ideal for the halving schedule, but that's simply because the exploding exchange rate with fiat is out of proportion with, specifically, merchant adoption. Once this normalizes, more people could want to spend their sats, because then the incentive to hold diminishes.

Bitcoin will decline inevitably, the way things are going, if its failure to gain mass scale MoE adoption continues.

I can't say it with that much certainty, but this is a possible outcome.

[Option 1] <-- this, but note: MoE adoption is currently behind price movement, this observation is correct. Nothing ensures that price movement and adoption should grow symmetrically, but a potential design flaw in the halving schedule is that it expects it. This is an open question for us to find out. Together with cryptographic weaknesses, this is the risk you take when you adopt Bitcoin into your financial world: we don't know what will happen. Any answer to this is speculative so we can only treat it as a hypothesis and use that to inform ourselves on what steps we shall take to shape Bitcoin into what we want to see.

Are we ******?

Only if you sit by and FUD yourself, but that has no external cause; you can only blame yourself for being effed.

21 sats \ 3 replies \ @Solomonsatoshi fwd 6 Jun

'I don't think any of my transactions are illegal.'

If you are in a jurisdiction where you can acquire sats and then later spend/dispose of those sats without incurring a tax liability for any gain in the value of those sats relative to fiat then you are very fortunate.

The vast majority of people living in 'liberal western democracies' do incur such a CGT liability whenever they acquire than later spend/dispose of sats...because tax departments have defined Bitcoin as a commodity and therefore imputed CGT liability on any such transactions. This is a very sly obstruction of the legal use of Bitcoin for MoE.

The extraordinary amount of recording required to comply with such a requirement if you are to use Bitcoin as a daily or even less frequent MoE is effectively going to make it impractical for most people. Therefore most of us who do insist on using Bitcoin as a MoE in 'liberal western democracies' do so illegally...we do not record, compute and pay the CGs on every coffee purchase (or zap on SNs!) because to do so is absurd, but it is also the law in almost all jurisdictions. We are defined, technically, as criminals, by the fiat cartel of government and bankers on every MoE transaction...even if we are not prosecuted. Most citizens will quite understandably not wish to take such a risk...and thus Bitcoin MoE is successfully obstructed.

The other estimated 70% of humanity who live under autocracies, are mostly quite explicitly banned from using Bitcoin as a MoE. Some of them too defy the law, but again the suppression of MoE use is more or less effective upon the majority of citizens.

El Salvador is the only nation I know of where MoE use of Bitcoin does not incur a CGT obligation...there may be other jurisdictions cantons or provinces, but they are surely few.

56 sats \ 2 replies \ @optimism 6 Jun

Germany and Portugal are two examples in Europe where this is not the case and IIRC Czech Republic too (but there you'd have to wait 3 years after acquisition, which is a long time, vs a year in the other two.) So in these places it's doable if you're able to do some financial planning - this affects 100M people. And success in these countries will definitely influence others to do similar things.

I agree that the classic liberal economies in Europe, especially the UK and the Netherlands, are terrible when it comes to financial freedom right now. But that is not static.

42 sats \ 1 reply \ @Solomonsatoshi fwd 6 Jun

That is good to know - it gives the opportunity and freedom for consumers and merchants in Germany, Portugal and Czech Republic to actually use Bitcoin as a MoE. I hope that freedom remains, and spreads and that people in other jurisdictions demand for that freedom too...and that can perhaps happen if we acknowledge and raise the issue and awareness of it!

42 sats \ 0 replies \ @optimism 6 Jun

Absolutely! There's hope, and there is work to do.

1069 sats \ 2 replies \ @DarthCoin 5 Jun

Solomon is a gov agent that is easily manipulating many stackers on SN... if you are listening to his bullshit, you are already lost. YOU HAVE BEEN WARNED.

5 sats \ 0 replies \ @Solomonsatoshi fwd 5 Jun

You have not and I expect cannot refute any of the points I have raised - and so you attack me personally.

Refute the facts and issues I have raised or confirm by default that you are a bigoted 'toxic maxi' TROLL and bully incapable of a good faith reasoned contest of ideas.

I wager 100,000 sats that you cannot credibly refute the majority of the points I have raised.

I raise the issues I raise because I give a fuck about and still have hope for Bitcoin and the freedom it enables but also question the rosy tinted NGU hopium that many Bitcoiners indulge in where they ignore the significant role of and power of the state in our lives and economy...and the states obvious incentives to and actions to obstruct the mass adoption of Bitcoin as a P2P MoE.

0 sats \ 0 replies \ @Car 6 Jun

13 sats \ 3 replies \ @justin_shocknet 5 Jun

It hasn't been "captured", it's always been a product of the national security state intended to serve as base money for institutional and global trade.

Security budget fud is always retarded, correlating it with retail MoE even moreso.

MoE is downstream of unit of account and irrelevant to chain activity.

Real chain-activity MoE is when institutions use it like they do wires today, still a decade out or more.

5 sats \ 2 replies \ @Solomonsatoshi fwd 5 Jun

'It hasn't been "captured", it's always been a product of the national security state intended to serve as base money for institutional and global trade.'

I reject that assertion as the evidence seems compelling that Bitcoin was the product of lengthy and complex work by cypherpunks and designed to enable P2P payments free of intermediaries and censorship.

My argument is that the fiat powers (banks+govt) in the west have responded to Bitcoin very cleverly- by capturing and controlling it via KYC and designation of it as a taxable speculative commodity. They have not (in the west) outright banned MoE use, but have via KYC+tax designation made convenient lawful MoE use effectively impractical.

Who is going to record cost of acquisition and then value upon disposal when buying an iced coffee and bread roll from a LN accepting cafe? Basically nobody and so retail consumer MoE is restricted to lawbreakers. Mainstream adoption is blocked. Bitcoin is defined and used almost exclusively as a (relatively harmless and largely corporate custody captured) speculative SoV commodity and Bitcoins revolutionary potential as a censorship resistant P2P MoE is prevented from gaining mass scale adoption.

0 sats \ 1 reply \ @justin_shocknet 6 Jun

Existing KYC law applied to a transparent ledger. That's the design, nation-state scale transparency. Iran can't move billions in Bitcoin without the NSA knowing about it (and if they really wanted to open Pandora's box they could probably just sweep it).

Of all the reasons retail MoE isn't a thing, taxes aren't one of them. That's retarded to even think that. Cash culture exists. Hell, if capital gains rates were even higher, there would be yet more incentive to spend it in small unreported amounts than there would be at exchanges.

The sub single percentage of people that actually want to pay/receive in Bitcoin is not enough network effect to matter in the meatspace.

0 sats \ 0 replies \ @Solomonsatoshi fwd 6 Jun

KYC requirements were introduced and applied to Bitcoin long after Bitcoin was introduced to the world. They were a response. A sly and subtle but very effective preventative one. They enable tracking and tracing of most transactions and effectively substantially reduce the ability for Bitcoin to be used pseudonymously.

Tax obligations act as a real barrier especially for retailers - a retailer asking their tax consultant will be almost always strongly advised not to accept Bitcoin because of the potential tax implications- add this to the risk of debanking and then the on the consumer side the absurdly complex tax requirements effectively discourage anyone except a very enthusiastic Bitcoiner who is prepared to break the law and risk potential prosecution. You cannot seriously argue this is not very effective obstruction designed to prevent the development of mass scale MoE adoption.

The result is, as you note, what we have now- a very low percentage of the potential user population wanting to use Bitcoin for MoE because of the multiple layers of FUD and obstruction put in place by bankers and governments.

They have succeeded in preventing sufficient use to even get close to the network effect engaging to create any threat to fiat monopoly over MoE.

0 sats \ 3 replies \ @LibertasBR 6 Jun

I had a brief interaction with him and quickly realized there’s not much to take from his ideas. Talking is easy — even a parrot can talk. His entire ‘argument’ is really just a guess based on a state-worshiping fantasy of what he wants Bitcoin to be. With that in mind, there’s nothing valuable to take from it. I’m new here, and what I see the most is speculator noise around Bitcoin — which is fair, since many who come here are only interested in all-time highs. Some of them learn over time, others go back to their fiat life after the first dip, since all they care about is price. Those who actually study don’t care about that — and it’s these people who have spread and will continue to spread Bitcoin to more people.

People who understand it’s money — and money is meant to be used. That’s the real majority of Bitcoiners.

0 sats \ 2 replies \ @Solomonsatoshi fwd 6 Jun

I understand Bitcoin and embrace Bitcoin as money, and that it was created with the intention that it can be used as money- ie as a SoV and P2P MoE-

My main point (which you grossly misrepresent and do not credibly refute) is that the state and banks have largely and slyly succeeded in obstructing the MoE use of Bitcoin to a very high degree that effectively protects their fiat MoE monopoly which is the basis of their power.

You can ignore or misrepresent and misunderstand the points I make but that does not refute them.

I am not here to assmilk or be popular- I am here to raise issues you and most others here are clearly desperate to avoid...as demonstrated by the failure of most respondents to even honestly and directly address, let alone refute, the issues of MoE obstruction I have raised...rather than seeking to attack me personally. . . in that shoot the messenger avoidance I believe you undermine the chances of success of the protocol by failing to deal with honestly with the challenges the protocol faces. If we as a community cannot even acknowledge and discuss the challenges the protocol faces how the fuck can those challenges ever be responded to?

Your populist 'solution' seems to be to pretend they don't exist- good luck with that.

0 sats \ 1 reply \ @LibertasBR 6 Jun

I said it there, your argument is speculative. ‘If by chance all the addresses were corporate speculators’, they’re not. ‘And in 100 years when the block reward is very low’, speculating based on a post just a few hours old. ‘Everyone will be holding and not moving’ based on something you pulled out of your ass. ‘Then miners won’t have incentives to keep the network running and it will be unprotected’ — if if if if. That’s not an argument here or in any language.

If my grandma had wheels, she’d be a bicycle. That’s the level of argument I saw in your post.

If that IF were really so worrisome, the network would still be protected by the miners; the network’s protection is defined not only by the incentive of fees and rewards, but by the protection of the coins already obtained. Trying to presume what the network will look like in the future just to make it fit your awful argument only makes the pile of nothing you wrote even worse.

0 sats \ 0 replies \ @Solomonsatoshi fwd 6 Jun

My argument is based upon what has already happened and observable trends and absolutely does not depend upon 'all addresses being corporate speculators'- it is based instead upon MoE use being sufficiently obstructed to prevent network effects which would result in Bitcoin MoE growth presenting a credible threat to fiat MoE dominance.

My argument does not rely upon 'Everyone will be holding and not moving'- it only relies on MoE use being sufficiently obstructed to prevent network effects which could result in Bitcoin MoE presenting a threat to fiat MoE dominance.

You can ridicule ANY argument by misrepresenting it, by exaggerating/parodying it, but that is not a credible reasoned refutation. It is a cheap trick.