via momchilandonov
Is it just me or one of the bigger Bitcoin gurus in the Bitcoin community is talking absolute bullshit?
Below is a 30 minute Highlights video of an interview regarding Bitcoin
I am absolutely shocked by the huge amount of Gaslighting and lies said by him. How is such a person accepted seriously in the Bitcoin community? It just shows the lack of due diligence in that same community.
4:16 He says the problem is trust, but in Bitcoin he trusts that the network and the individual nodes will always be up although there is permanently guaranteed increase of demand in electricity, disk space, land and computation. Governments can absolutely impact the network by pressuring the major ISP and even the node operators themselves for polluting the environment – something I completely forgot is possible and poses a risk. It’s like shutting down a server, but just on a major scale. Internet is highly regulated by central authorities. Also if what he wants happens and everyone uses Bitcoin the price will stop increasing, because there will be no new source of funds since everyone already put everything in it. But the costs for the network will only go up, as the size of the Blockchain will be huge, because it grows exponentially and not linearly. The transactions will also grow exponentially leading to even more disk storage needed and it’s the same for the other requirements.
7:48 “The problem is inflation” – the problem is the fallacy that whatever you use for exchange/tender should never change in value and that is impossible as everything changes in value due to the basic economic principle of supply and demand. Bitcoin constantly changes in price, so it’s even worse for exchange, because it lacks the stability of fiat. Gold has 22 Trillion market cap, yet it still changes it’s price with 1-2% on a daily basis thus not suitable for transactions, so it doesn’t seem like big market cap would fix that Bitcoin problem. Fiat currency solves that problem, as they barely move 5% on an yearly basis. Enough time to adapt. In the long term currencies loses value, but there are so many ways to defend against it that it’s hardly a problem.
Corruption and how assets are handled by officials is the real problem, but governments can steal money regardless if there is inflation or not and regardless if we use Bitcoin! A simple example is to just spend more for less. Bitcoin on the other hand has inherited deflation (which is a worse economy) due to how easy it is for some coins to be permanently lost. A short explanation that I like -> “Deflation means things will cost less in the future. This means there is an advantage to not buying things now. Not buying things now means people can’t sell stuff. People not being able to sell stuff means they can’t make money. Not making money means people struggle and lose jobs. If that happens enough, the economy goes into as downward spiral.” We could argue that this creates scarcity, but demand drives prices up and not scarcity. Of course supply and demand could simply make the price go up, but the problem is you are buying an asset without knowing it’s real market cap. In other words this is quite silly and stup*d, because you don’t really know the value of the asset. It’s like investing in a company, but no one knows if the full price is 1 million or 100 million. So you rely on a price created by a highly speculative market. And this deflation will only get worse with time, as there really is no solution to the problem within the Bitcoin protocol.
19:03 Bitcoin can absolutely BE COPIED – literally every Bitcoin fork creates new 21 million BTC. Exact copies of the original ones, so we can argue that there is actually double spending just using different prices and networks depending on each individual node operator’s consensus/opinion on what is better. This also leads to another lie that Bitcoin is perfect – if it was there would never be a single fork, as the protocol shouldn’t be allowing for forks to begin with. Those forks show that the Byzantine General Problem is not solved, as some very authoritarian generals decided to use and trust in Bitcoin Cash. How is that for a consensus and a trustless protocol? The forks create devaluation, as assets are moved from Bitcoin and used in the hundreds of forks. He doesn’t discuss the 51% attack which also causes copies and double spending problems.
19:14 “get paid 0 to try and copy it”?! What has he been smoking here? There are billions $ to be made if you can copy it! 🙂 People already made billions from altcoins and there are still money to be made in that. Bitcoin has a fallacy of being the best, because it was the first, but that doesn’t automatically make it any different from the other crypto projects.
20:18 This seems kinda messed up, as he implies disclosure of ownership, paying of taxes and oversight by the government. I guess Michael Saylor doesn’t know that his cult followers are mostly anarchists and don’t want that.
20:46 another major lie – gold can’t be diluted!!!
20:58 “Bitcoin can’t be confiscated”, yet it’s full of news all over the world where authorities managed to confiscate cryptocoins. Also all hackers/authorities have to do is install a keylogger in a given system and just wait. Also if they just log into the network and check the assets it wouldn’t raise any concern to the target, because the network doesn’t keep logs of who is accessing it (this seems like a major security flaw in the cryptoworld, no?!). So they can validate someone is a criminal if he didn’t disclose ownership and paid taxes for the crypto.
21:45 absolutely horrible asset, because it has 0 intrinsic value and he keeps talking about history without discussing the intrinsic value and how important it is for the long term.
22:56 YOU ABSOLUTELY GET THE CRYPTO! All you need to do is convince them to give their shared keys by intimidation – you can use extortion by threatening to kill loved ones/friends. If the legal authority can seize it in a completely legal and lawful mannger, it’s very stup*d and naive to claim that a cutthroat criminal wouldn’t make you talk :). Hell we even have plenty of examples from modern day Russia – billionaires somehow keep falling from high buildings although they are supposedly well guarded?! So even money can’t be a guarantee for protection.
His example is actually against his claim, because in the current world it’s hard to steal some assets with physical force. Jewelry sure, but retail estate is exchanged in the presence of authority i.e. commissioner for oaths and guess what? You pay quite hefty taxes for it – both the buyer and the seller must do so. He talks, as if the land and housing market are exchanged similarly to Pokémon! Suddenly moving all your assets from a bank will leave traces and raise red flags – also bank transactions can be delayed and reversed giving time for authority to act. Also criminals can leave many traces – GPS location, video recording, voice, face, fingerprints etc. In the Bitcoin world once they steal the crypto there is no recovery! Also inheritance works quite well today, but with crypto it’s way more complex. The only option seems to be to trust a third party (a bank safe or a custodian) with keeping your seed there :)! How can you be sure that a relative won’t otherwise steal the assets if you share your seed before dying?
24:05 this also is a complete lie – the Peso devalued in 2002, by around 25% for the whole year and not just in a single night by 90%. Also why would he keep 1 million currency in an unstable country? Seems like he was asking for it considering that Argentina had a very high level of debt. What he should have done is invest in assets with intrinsic value. I guess he didn’t knew back then that currency is not a store of value? Jeez, who would have thought!
Sources https://www.worlddata.info/america/argentina/inflation-rates.php & https://en.wikipedia.org/wiki/1998%E2%80%932002_Argentine_great_depression
Google AI also shares the same insight “The Argentina peso experienced varying inflation rates between 2000 and 2004.In 2000 and 2001, there was slight deflation or very low inflation. However, in 2002, the inflation rate surged to 25.9%. By 2003 and 2004, the rates decreased to around 2-4%”
25:44 “It will go up because of adoption” 4 years later no one uses it for payments. Even after it has passed some regulations and it’s completely legal to use it for payments there is no incentive to use it over fiat currencies.
26:21 “3 to 5 years it will certainly replace gold” This was so unrealistically optimistic. One major elephant in the room is the market cap. It’s completely imaginary, because we can never know how much Bitcoin was permanently lost from dead holders or those who simply don’t have access. He ignores another elephant in the room – the USA (or any random major country) buying/trading Bitcoin for the purpose of paying off it’s debt to the retail suckers. This way it brings in more centralization of assets and also easily manipulates the price and trust if it wants to. Trump had plans to buy 5% of it recently. Imagine if he buys it at 100k and dumps it at 200k. And he starts doing this every 4 years – there will be no incentive to buy Bitcoin if in the end you will be essentially buying and paying off American debt.
I am sure that there is much more to it, but I am not saavy enough, so feel free to add.