Actually, these *are* the things I talk about when I discuss Bitcoin with people that are curious. My biggest cryptocurrency investment is in Bitcoin at the moment, but I don't believe that Bitcoin itself will be the de facto cryptocurrency of the future, at least not in its current form, for the two reasons you mentioned, as well as the mining hashrate centralization in China and energy expenditure issues which you mentioned in your next post.

There are efforts to correct these problems though. Whether they are on the right or wrong track is another matter. First of all are the upcoming Bitcoin forks: Bitcoin Gold in a couple weeks that aims to fix the mining centralization problem by using an ASIC-resistant crypto algorithm, and Segwit2x in November which is supposed to alleviate the transaction speeds by making the blocks twice as big. There's also the upcoming Lightning Network that will attempt to address Bitcoin's scalability and fee problems by allowing off-chain transactions through some sort of smart contract system. I don't know the specifics of this system yet, but from what I understand, we're not going to see this go live for quite a while, so we'll likely see our transaction fees and backlog grow significantly before those problems are addressed.

I'm of the opinion that Bitcoin as a first-generation blockchain technology is probably not going to be able to scale the way the world needs even with the various bandaid solutions that are created for it. I think newer concepts are going to be necessary for cryptocurrency to replace physical currency. For example, there's a cryptocurrency called IOTA that I think has this potential. Instead of a linear blockchain like Bitcoin or Ethereum, its ledger system is what is known as a directed acyclic graph that they call the Tangle. In the Tangle, to process a transaction, you must first verify two previous transactions already in the system. Since you are performing the transaction processing yourself, there are no miners and no fees, and because of this arrangement, scalability is not an issue. In fact, as more transactions are processed on the network, the faster the network becomes. IOTA is designed with the intention of acting as a secure yet trustless communications channel for machine-to-machine interactions (aka, Internet of Things), but if the system is proven viable (still in its pre-alpha stages and not truly decentralized yet), I see no reason why it couldn't take off as a currency system as well.

Bitcoin may not be the future but I think cryptocurrency definitely will be.

Sure. When people ask me if I think they should invest in Bitcoin, I tell them no, at least to not invest any money that they couldn't afford to lose completely. If Bitcoin's market cap eventually matches that of gold, I think I read that 1 BTC will be worth about $500,000, but if Bitcoin isn't redesigned to be capable of even scaling to the speed needs of a single city's daily transaction requirements, if the fees and energy expenditure can't be reduced, if the mining centralization (control and power over the Bitcoin network) isn't fixed, I think Bitcoin will only go back down in value. Maybe never $0 again, but a lot closer to it than it is now.

Even setting these issues aside, there are more problems to consider. State-of-the-art quantum computers are currently allegedly around the 50-qubit range, but with the billions of dollars now being dumped into quantum research, how long before they are in the thousands or millions range? Maybe Shor's algorithm makes SHA256 obsolete and a post-quantum crypto fork is necessary to keep Bitcoin secure. But maybe the computational costs are too great with this new algorithm to let the blockchain be viable. I'm expecting within the next 12 months for a cryptocurrency crackdown to happen in the US, which should dramatically alter the market, at least in the short term. Maybe Bitcoin will be banned. I think many Ethereum-based tokens will be for violating SEC rules.

My non-crypto cash has already been digital for as long as I've been an adult. I almost never carry or have any physical cash. My paycheck is direct deposited into my bank account, I pay for everything through my credit card, and that is auto-paid in full every month. When I need to give a friend $10, I'll pull out my phone and send it to them through PayPal/Venmo, and soon I'll probably be sending money from my phone to theirs through Apple Pay's peer-to-peer payments. Cryptocurrency is the same deal in a different flavor. It's just a matter of time before the ease of use catches up to make it appealing to normal people.

I've never used ShapeShift, but I hear there are high fees with it. My strategy, assuming ShapeShift is too expensive, would be to go to coinmarketcap.com, search for each coin, then click on the Markets tab to see where they are traded, and try to figure out an exchange I already have an account on to convert BCC -> ETH -> XRP, or maybe BCC -> BTC -> XRP.

That's a good question, and I don't have a good answer for that because I wouldn't use it right now in place of electronic or physical USD. I think there are two problems that prevent it. The first is usability. Right now, it's very difficult for an average person to deal with the digital wallets, acquire Bitcoin, manage addresses, and actually spend them. There's going to have to be a lot of effort expended into making this stuff intuitive. Scanning QR codes with Bitcoin addresses is not a final solution, in my opinion.

The bigger problem is that Bitcoin today is too volatile to serve as a useful currency. Most people that would treat Bitcoin as a practical currency aren't going to want to be paid $1000 worth of BTC only to have it be worth $800 a couple hours later. Similarly, I don't want to pay $40 worth of Bitcoin for pizza only to have it be worth several hundred or thousands of dollars in a few years (first documented Bitcoin purchase was for two Papa Johns pizzas for 10,000 BTC). I wouldn't want to provide a loan to someone for any amount of Bitcoin that would come back to me valued at a fraction of what it was when I lent it, and just the same I wouldn't want to lend an amount of Bitcoin if it would be worth several times the lending amount when owed back to me, because how would the lendee afford to pay it?

Bitcoin's market cap is nearing $100 billion, but even that amount is still too small to match its current and growing interest, which I admit is largely fueled by speculation. I read that Bitcoin's user base doubles every 18 months. That's part of the reason we keep seeing dramatic rises in BTC prices. There's still untapped demand. Until Bitcoin can reach its maximum capacity for demand, which keeps growing with more awareness, it will not be able to stabilize and convert from a speculative asset to practical currency, so we will continue to see wild fluctuations in assumed value.

I wasn't paying attention today and BTC crossed over the $6,000 mark. Won't be much longer before 1 BTC = MSRP of a new Stern Pro.

That's not really a fair characterization of Satoshi Nakamoto's invention. I think a Nobel prize is in order, but not for stupidity. Blockchain is more than just a clever idea for financial transactions, it's going to revolutionize the future of how we exchange and verify all kinds of information. I doubt even though he created it, he could have fully understood the implications and the global impact the technology would have in just a few years from its release. Bitcoin, as a proof of concept, shows the viability of blockchain technology and the potential use-case as a currency, but obviously there are some glaring flaws. These are easier to see in hindsight, especially when we are faced with the reality of a 0.1% global energy expenditure committed to Bitcoin transaction processing, and have had thousands of people able to ponder on blockchain and cryptocurrency for a decade vs. Satoshi all by his lonesome. For all Satoshi knew, Bitcoin and blockchain would be an amusement for a small group of computer nerds and never amount to anything substantial, as was the case for its few first years.

Any way, I agree that Bitcoin as it is isn't sustainable. Proof of Work has shown that it's not a model that can reasonably scale. Ethereum also uses Proof of Work but is in a multistage process to convert to a Proof of Stake system that doesn't utilize resource heavy mining for transaction consensus, but rather selects volunteers from the pool of Ether holders (stakeholders) to validate transactions with their stake acting as their leverage in the consensus process. The guy that invented BitTorrent recently developed a concept for a cryptocurrency that provides consensus through a Proof of Space, in that consensus is achieved through usage of harddrive space rather than computationally heavy algorithms. Both systems are expected to be far more efficient and less ecologically damaging than Bitcoin's current system. Same for IOTA which I mentioned earlier. I'm sure Bitcoin will eventually fork to one of these solutions or maybe something more creative to fix this problem.

This is a deliberate feature of Bitcoin. There is the possibility in the future of dividing a Bitcoin to further levels, but that is fundamentally different than printing more money. When you print more money, you devalue the rest of the money in the pool. When you divide your existing money, it's more like a stock split; you don't lose value. In a system with ever more money added each year, you can expect your $50k under your mattress to erode in value year after year. Your spending power goes down by holding onto it; it's still $50k, but $50k x years from now has the spending power of $40k today. In a deflationary model like Bitcoin, what's more likely to erode is the amount of total Bitcoins available, as people die and forget to transfer their wallets to other people, etc. This means the value of a bitcoin in proportion to the total amount of bitcoins available will always go up, no matter what Bitcoin's price is compared to "real" money.

Miners are not only incentivized by freshly mined bitcoin, they are also paid transaction fees from the transactions they are processing. When the last bitcoin is mined, they will do as they do now each time the mining complexity doubles: expect more money to process transactions.

I think the rise of Bitcoin is a black swan event and not just another tulip craze. We aren't seeing its price skyrocket just because of mania (which there has been a lot of especially in the past 5-6 months) but because there are a lot of forward thinking people that recognize that we have potentially stumbled upon the next major paradigm of currency. That's not just being a cryptocurrency, any country could make their own if they wanted, but a global currency that is not and cannot be fully controlled by any single government and is owned and operated by the people. That's doing for money what the Internet did for information.

I think we keep seeing the price rise and not stabilizing because we haven't actually felt out and found its true value yet. $10k-$11k per Bitcoin might still just be a fraction of its eventually realized value. Until we find that value ($50k? $1M???) Bitcoin is obviously a terrible currency ($100+ million pizza) but a potentially amazing investment. If Bitcoin does become a viable currency one day then we are still in the early adoption days right now, before Wall St. and big business have embraced it.

I've been willing to throw a little bit of money at this experiment. If I'm wrong I won't have lost much, but if I'm right then I will be obscenely rewarded. I think the ratio of risk to reward is significantly in my favor.

The whole IOTA naming convention is a bit convoluted. An iota cannot be divided into a smaller unit. It is analogous to a Bitcoin satoshi, which is the smallest possible fraction of a bitcoin (1/100 millionth of a bitcoin). Apparently the IOTA creators went with this scheme to help eliminate the misunderstanding people have with Bitcoin's divisibility, but the price you see for IOTA on the exchanges is for an MIOTA, which is 1,000,000 iota.

So to compare total units of IOTA to Bitcoin, you have to compare the number of sats (shorthand plural form of satoshi) to iota, or whole bitcoins to GIOTA (1 billion iota), or mBTC (millibitcoin, 1/1,000 of a bitcoin) to MIOTA.

There are 21 million total bitcoins * 100 million sats per bitcoin, which means there are a total of 2.1e15 sats vs. 2.78e15 iota, or 21 million bitcoins vs. 27.8 million GIOTA, or 2.1 billion mBTC vs. 2.78 billion MIOTA. If you want to get a feel for IOTA's comparable standing against Bitcoin, you would have to multiply IOTA's exchange value by 1,000 or divide Bitcoin's value by 1,000.

If I were in your shoes, I would leave it there. You already weren't missing it, so why not ride it out and see if Bitcoin goes 10x again? Worst case is you lose something you've already once forgotten you had.

Edit: Another option to consider is just taking half out. Then if the value doubles later, take half again, and if it doubles again, take half, etc. That way you're getting rewarded ~$6.5k each time Bitcoin doubles and you've offloaded some risk of holding, while at the same time you still have some skin in the game if the value really skyrockets.

I'd recommend getting into the top currencies (specifically BTC, ETH, and IOTA) and avoiding the rest of the altcoins. Not that there isn't money to be made in alts, it's just that you're probably not going to have good luck predicting their movements, and just long holding some of the "proven" coins while ignoring all short-term dips and gains will likely give you better results.

The other issue is that you can expect in the near future a big crackdown on initial coin offerings (ICOs) and crypto-tokens that are designed as stores of value rather than offering utility functions for the network. For example, the SEC may ban Bitcoin in the US because it serves no purpose but to act as an unregulated currency (BTC is merely a store of value) but allow Ethereum because ether is used as "gas" on its blockchain to process smart contracts and is not designed to be a value store. I could see an exception being made for Bitcoin for various reasons, but anonymous currencies like Monero being outlawed because there's no public ledger.

Many of these ICOs/altcoins are not put together by organizations with legal teams that have been attempting to validate the existence of their coins aside from being money generators, so the SEC is probably going to outlaw them in the US. You are going to want to do significant research on an altcoin to make sure it passes what's known as the Howey test. If it fails, then the crypto token is considered a security or a share of the company that created it, and it will very likely be banned. Some exchanges like Bittrex have already preemptively started delisting altcoins that fail the test to prevent future problems.

Lots of familiar faces in that AI thread. I don't think it's a coincidence that many of us in cryptocurrency also have interest in the future impact of AI. Though this thread provides more opportunities to take advantage of the future for personal benefit besides just investing in NVIDIA or SoftBank.

I bought some TRON (TRX) about a month ago. I did the most minimal amount of research on it and bought a small amount. Now I kinda wish I loaded up, because it's been skyrocketing.

https://coinmarketcap.com/currencies/tron/

I still don't know anything about it, so I have no concept on whether it's just on a pump and dump path right now or it's turning into the next Ethereum.

I woke up this morning and thought, "Nice, Bitcoin's on sale!" and bought some more. Apparently I bought the dip, because it's already back up about $1500 from my order price. I was honestly hoping to see a larger drop. Maybe it still will.

Pretty wild to see the price pump. I've stayed out of Ripple out of principle because I think it's harmful for the crypto-community, but I'm expecting to see it double even from where it's at now when it gets added to Coinbase. We might even see it cause the Flippening (the moment where Bitcoin is displaced as the top crypto by market cap), and then a huge short-term increase in price along with Bitcoin in free-fall as many people shift their BTC and ETH holdings to XRP. We may be looking at <$5k BTC again in the near future, but I don't expect that to be permanent.

My belief is that Ripple has the backing of the banks because they recognize that cryptocurrency poses an existential threat to them as its influence grows. Rather than risk just hoping and waiting on the US outright banning crypto, they instead choose their own crypto-champion. If you can't beat 'em, join 'em. Ripple has the speed it does (1500tx/sec vs BTC's 4tx/sec) because it's a centralized blockchain. All the nodes that provide consensus are controlled by Ripple's foundation, which means that it's not truly a trustless, triple-entry blockchain. It's not much different than a double entry ledger system where you've placed your trust in a third party entity that the transactions are accurate. Ripple fully controlling all of its consensus nodes also means that the foundation can do things like make changes to the network without buy-in from the community. For example, printing more XRP at will, rolling back transactions they disagree with without having to fork the chain, and other shenanigans.

So why would the banks care about this? If they can print their own crypto, they can trade it for other kinds, like BTC and ETH. The banks may have missed the boat when ETH and BTC grew from nothing to hundred billion dollar market caps, but Ripple provides an opportunity to get a lot of that wealth handed to them for virtually nothing, just some tokens that they created at will as crypto-whales trade in due to fear out missing out on a Ripple gold rush. After this, I think we'll see BTC and ETH return to even greater all time highs, with the rest of us that traded out our BTC and ETH holding bags of not nearly as valuable XRP.

Another possibility is that XRP surpasses BTC's market cap and stays there. One of the reasons BTC and ETH hold such high values is because they are the gateway currencies from traditional fiat to any of the altcoins. Very difficult to acquire an altcoin if you aren't trading BTC/ETH or mining. XRP as the de facto currency could become the new standard trading pair in place of either BTC or ETH, which would allow Ripple's foundation to manipulate and control the values of all cryptocurrencies at the same time. The only salvation in a situation like this is the creation of new fiat gateways that allow the direct transfer of traditional currencies into varieties of cryptocurrencies so that we don't have to be stuck middleman-trading through BTC/ETH/LTC/XRP, but this is a monumental problem to tackle and the reason why most of us are stuck handing our traditional money over through Coinbase and just a handful of other exchanges.

Gold has intrinsic value, but not as much of it as to support its current valuation, and you know this because most gold mined is used for making jewelry and gold bars (things that we arbitrarily value), much less of it for its actually intrinsically valuable chemical and material properties in electronics.

Many of your arguments for the value of gold are similar to the arguments for the value of Bitcoin. Bitcoin has rarity (maximum of 21 million coins ever), costs a lot to acquire (about $1,500 in electricity), and has value because people value it. That last one is a bit tongue-in-cheek, but really think about what you're saying about gold in history. It's been used as a monetary backing throughout history around the world, why? Because people throughout time have valued its properties of being shiny and scarce.

It's irrelevant how many cryptocurrencies exist in regards to whether people value one over the other. This is a huge point you seem to be missing. It's like me telling you that I have a million US dollars and you telling me, "Big deal! I have 100 trillion Zimbabwean dollars! That's 100 million times more than you!" Ignoring that 100 trillion Zimbabwean dollars was worth about 40 cents USD.

No matter how many cryptocurrencies are created, there will only ever be 21 million BTC. You can't even say that the amount of gold that will be on Earth is never going to be more than it is now.
http://www.scienceinfo.news/asteroid-containing-600-kg-gold-will-soon-hit-earth/

I doubt it. The thing that uniquely gives cryptocurrencies value over other forms of exchange is that the record of the transaction is also the transaction of the currency itself. Adding a physical thing to the mix means that you have to add back in the need to trust another party, that there actually is some gold somewhere to back that currency you just spent or are holding. You can't objectively say that you traded n units of gold for a widget through a supposedly gold-backed cryptocurrency the way you could objectively say you spent n BTC on that widget.

Same card, but it seems the US market is currently unaffected:
https://twitter.com/BitPay/status/949186646091751424

People have had money stolen from them using a compromised EtherDelta site:
http://mashable.com/2017/12/21/etherdelta-hacked/

The recommendation I've seen is to download the ED code from GitHub and host it on your own webserver. Here's a thread from Reddit where people discuss how to do it:
https://www.reddit.com/r/EtherDelta/comments/723mzq/how_to_run_a_local_etherdelta_copy/

I traded out most of my TRX the other day. I bought in at like $0.0018 and sold over $0.16 or so. Made over $2000 on a $20 joke investment. Literally a 100x gain after accounting for extra TRX I was given in free airdrops. Absolute insanity. Doubt I’ll ever have that kind of dumb luck in crypto again.

I was going to let it keep riding, but I saw that Sun’s presentation was a flop and then news broke out that TRON’s whitepaper is mostly a copy/paste job from other tokens’ whitepapers, then I knew I had to get out.

I kept only 1000 TRX. In my opinion, Justin Sun is likely a conman but TRX has enough money flowing into it that they could hire a world class team to actually build TRON into a real project worthy of its hype. In that case, I won’t have completely missed the boat by selling now, but I’m happy enough to take my fresh gains and invest them in a bunch of currencies I’ve been interested in.

Basically, haha. I figure I’ve already cashed out the meat of it, it wouldn’t hurt to keep about $150 worth of it when I only paid about $2 for it. I don’t have faith it won’t drop to $0 after the scandals, but the altcoin market is pretty irrational.

http://thehill.com/policy/finance/368047-dimon-i-regret-calling-bitcoin-a-fraud

JPMorgan Chase CEO Jamie Dimon has walked back his criticism of bitcoin, saying its underlying technology could be useful for financial markets.

Dimon told Fox Business in an interview aired Tuesday that he regrets calling the cryptocurrency “a fraud,” but that he’s still “not interested that much in the subject at all.”

Market cap is already $1.39 billion though. I think this coin has already multiplied as much as it will. If the total supply was worth $14 million instead, I think that would have been a better experiment.

He is right about Bitconnect and Tether though. We can disagree about whether crypto in general is a scam, but Bitconnect was a very obvious Ponzi scheme that was going to self-destruct up one day. Tether is also a fraud. I think we would have seen a more dramatic drop in crypto values the past couple days if not for Tether's false currency propping up the entire market. One day we're going to see that one collapse too, and maybe take the market with it if a new fiat backed crypto doesn't take its place first.

I'm not hoping for one, but I'm expecting a massive crash in the near future. In any case, if Tether is illegitimate (very likely, its behavior is too suspicious), I'd like for the CFTC/SEC to pummel them sooner rather than later so that we can rip this bandaid off earlier and hopefully recover from Tether/Bitfinex meddling sooner.

We still need to hear the verdict on Tether. May not be over yet.

I still think it might, which is why I haven't cashed out my crypto holdings. As has been said throughout this thread, Bitcoin may not be the future, but cryptocurrency and the blockchain certainly are, which is why I and most of the other crypto enthusiasts here put our money into lots of different currencies and not just Bitcoin. Right now, it's a matter of luck and good judgment in choosing the right crypto coins to invest in. Bitcoin may not make it after Tether gets hammered, but at least one of the currencies out there right now probably will.

Bitcoin is still higher than where I entered. Still worth more than what I put into it in cash. As for the alt-currencies, some I'm still much higher than where I entered, others much, much lower. Me cashing out 95% of my TRON at 100x my investment has made me pretty immune to worrying about watching values fall on many of the cryptos I paid for with those winnings. Either way, I plan to ride my crypto holdings to the ground or to glory. I'd rather completely risk my small investment than miss out on a potential huge upswing. I still believe in cryptocurrency, even if I may have chosen ones that won't survive in the next generation.