Crypto Currency Mining a Giant Pyramid Scheme?

[A.Justice]

Hard currency has a backer. If it's backed by a responsible country or not is another question.
No country backs Bitcoins although I think China use to. No country depends on Bitcoins to keep itself afloat.
If it nose dives it's only those owners spread across the globe that got stuck with it that will cry.

I think in some ways Bitcoin is "backed" by every countries fiat, in a sense that it can be exchanged for whatever currency you want. If the US dollar collapses, for example, you could cash out for yen or euro. In that way I trust Bitcoin more than I do a single Fiat currency.

Like I said before, it's ALL a pyramid scheme that you have no choice but to participate in. To me, the Bitcoin pyramid seems more stable than any individual fiat.

Edit:
I didn't realize this post was so old, sorry.

 

[Lt.Dan]

backed" by every countries fiat, in a sense that it can be exchanged for whatever currency you want.

You can also exchange any currency for another fiat currency, so would that make every currency backed by every currency? I dont think so.

 

[Sanwizard]

You can also exchange any currency for another fiat currency, so would that make every currency backed by every currency? I dont think so.

In the US, we are stuck with the Dollar, which for a long time, was a good thing. That being said, with the complete incompetence and corruption of our government, holding another fiat like Swiss Francs is probably better at this point. Check out CHF vs USD. BUT, CHF does not have the ability to triple in value in a few months like BTC does. So far, that bet has paid off well for me.

 

[Hedges]

You may be experiencing the "greater fool" theory, driven by furloughed employees with a 401(k) account (or other liquid assets, if no Bitcoin securities they can trade in retirement accounts) and more money than sense.
Make sure you've got yourself a chair before the music stops.

Gold - almost all paper gold, influencing the market price. Imagine that being removed from the gold standard.

 

[Sanwizard]

You may be experiencing the "greater fool" theory, driven by furloughed employees with a 401(k) account (or other liquid assets, if no Bitcoin securities they can trade in retirement accounts) and more money than sense.
Make sure you've got yourself a chair before the music stops.

Gold - almost all paper gold, influencing the market price. Imagine that being removed from the gold standard.

My Bitcoin is in my retirement account via Greyscale Trust GBTC. Even today, its up a few thousand percent. I had Etherium in the same account, but sold that to buy real estate in South Carolina. After I sold, Ethereum doubled twice. Kicking myself, but at least I used it to buy an appreciating asset. Waterfront in South Carolina is getting expensive now that everyone is leaving Democrat states to free states.

 

[BMcL]

My Bitcoin is in my retirement account via Greyscale Trust GBTC. Even today, its up a few thousand percent. I had Etherium in the same account, but sold that to buy real estate in South Carolina. After I sold, Ethereum doubled twice. Kicking myself, but at least I used it to buy an appreciating asset. Waterfront in South Carolina is getting expensive now that everyone is leaving Democrat states to free states.

I had an investment advisor encouraging me to buy Bitcoin back in 2016. Never did.
LOL. I can't complain today because of other good investments, but I probably would have a couple million if I had taken his advice.

 

[Sanwizard]

I had an investment advisor encouraging me to buy Bitcoin back in 2016. Never did.
LOL. I can't complain today because of other good investments, but I probably would have a couple million if I had taken his advice.

Yeah, I bought when it was $10. When it hit $600, i used 3 to buy an Alienware laptop. Now its the most expensive laptop on the planet.
My kid still has around 100 of them. Me only 2, but I bought GBTC just when Greyscale started that fund and Fidelity made it available for a 401K. I sold all my other stocks and put everything in GBTC. Huge gamble, but that laptop taught me a lesson, and its paying off nicely?

 

[BMcL]

Yeah, I bought when it was $10. When it hit $600, i used 3 to buy an Alienware laptop. Now its the most expensive laptop on the planet.
My kid still has around 100 of them. Me only 2, but I bought GBTC just when Greyscale started that fund and Fidelity made it available for a 401K. I sold all my other stocks and put everything in GBTC. Huge gamble, but that laptop taught me a lesson, and its paying off nicely?

Congrats, it's always good to be able to work only because you want to.
I'm retiring in about a month and have plenty of projects to do. Gotta stay busy.

 

[Sanwizard]

Congrats, it's always good to be able to work only because you want to.
I'm retiring in about a month and have plenty of projects to do. Gotta stay busy.

Nah, I cannot retire. Still need the income to pay for batteries and inverters! Wish I had a government job for the pension and medical for life. If Bitcoin goes to 1 million, then I can retire. Hoping for that within the next 3-5 years. ?

 

[Sanwizard]

Nah, I cannot retire. Still need the income to pay for batteries and inverters! Wish I had a government job for the pension and medical for life. If Bitcoin goes to 1 million, then I can retire. Hoping for that within the next 3-5 years. ?

By the way, if you bought Cardano( ADA) last week, you would have made over 17% on your money in one week.

 

[Hedges]

Wish I had a government job for the pension and medical for life.

Government job pays around 2/3 salary of private industry. Value of pension and medical might make up for that.

During the time I had such a job (starting 2009), pension was 1% of (average salary over 3 highest years) per year of service. If > 20 years, 1.1% of salary. And there was a 401(k)-like plan with up to 4% employer contribution.

Compare to what my boss's plan was, having started much earlier. 2% per year of service, e.g. 80% of salary after 40 years. And based on high salary while in Bay Area, but could retire to Florida without cut in benefits.

I earned a 5% pension, but no COLA applied to the amount until I start collecting at minimum age of 62. I'll get about $400/month. If I went back and worked 3 years just before retiring, that would "COLA" the salary it is computed on. (Social Security is adjusted, based on bogus low inflation rate, regardless of which years you work before reaching retirement age and collecting.)

I would have liked to get that medical benefit, but needed to be covered under medical plan at work for at least 1 day before retiring and collecting, that is, had to be working at least one day when I was 62 or older. But I think benefit is greatest for a period between retirement and Medicare eligibility; that covers most costs, right? Any of these plans, I think have to sign up for Medicare when eligible.

I've figured you need to invest about 30% of your salary for your entire career to have a comfortable requirement. That is pretty much the excess private sector salary over government salary. (Building equity in your home counts toward that 30%)

 

[Hedges]

After all, they offer what for bitcoin mining is most important: Cheap, reliable electricity.

Puerto Rico's generous tax breaks and stunning beaches are attracting an influx of crypto entrepreneurs: report

Crypto enthusiasts are increasingly moving to Puerto Rico. Under Act 60, residents do not have to pay taxes on capital gains.

news.yahoo.com

 

[BMcL]

Does anyone know if Ethereum mining will stop soon ?
Videos on YouTube were claiming mining for Ethereum will stop. I don't know why.
Heard anything ?

 

[curiouscarbon]

Does anyone know if Ethereum mining will stop soon ?
Videos on YouTube were claiming mining for Ethereum will stop. I don't know why.
Heard anything ?

check out

proof of work

proof of stake

 

[Sanwizard]

By the way, if you bought Cardano( ADA) last week, you would have made over 17% on your money in one week.

Make that 42% in one week now.

 

[stienman]

Does anyone know if Ethereum mining will stop soon ?
Videos on YouTube were claiming mining for Ethereum will stop. I don't know why.
Heard anything ?

Ethereum is moving from proof of work (ie, compute power) to proof of stake (ie, ethereum tokens locked into a computer which validates other transactions).

Proof of stake requires significantly less computing power, and has the same "rich get richer" issue that proof of work grants.

Each transaction validated by a validator gives all the stakers a little ethereum. So instead of "mining" via compute power, you're "mining" via putting your ethereum into a pool on a validator.

The transition is happening slowly, in a series of stages. Right now people are taking their ethereum, and starting up validators. Validators have to be tested on the network for a time before the network switches over to them. The goal is a little over 16 thousand validators, and each one must have at least 32 ethereum staked to join the validator network, so an initial investment of between $100k and $150k, plus the cost of a reasonably powerful, fast computer and fast internet connection.

If your validator fails to reach consensus in time, given an assignment, or provides invalid responses, the staked ethereum is burned in small amounts for each infraction, and your validator is less likely to be chosen for the next block consensus pool.

It's a fairly neat, self-regulating system.

Most people expect the final stage of the transition to occur later this year. In the meantime, miners are mining as much as they can while it's still proof of work.

Also, people are already staking their ethereum. For instance, I've staked my paltry amount on Coinbase with their Ethereum 2 token, and when the network transitions it'll go toward staking and I'll earn "mining" rewards without having to run a mining machine.

 

[curiouscarbon]

Ethereum is moving from proof of work (ie, compute power) to proof of stake (ie, ethereum tokens locked into a computer which validates other transactions).

Proof of stake requires significantly less computing power, and has the same "rich get richer" issue that proof of work grants.

Each transaction validated by a validator gives all the stakers a little ethereum. So instead of "mining" via compute power, you're "mining" via putting your ethereum into a pool on a validator.

The transition is happening slowly, in a series of stages. Right now people are taking their ethereum, and starting up validators. Validators have to be tested on the network for a time before the network switches over to them. The goal is a little over 16 thousand validators, and each one must have at least 32 ethereum staked to join the validator network, so an initial investment of between $100k and $150k, plus the cost of a reasonably powerful, fast computer and fast internet connection.

If your validator fails to reach consensus in time, given an assignment, or provides invalid responses, the staked ethereum is burned in small amounts for each infraction, and your validator is less likely to be chosen for the next block consensus pool.

It's a fairly neat, self-regulating system.

Most people expect the final stage of the transition to occur later this year. In the meantime, miners are mining as much as they can while it's still proof of work.

Also, people are already staking their ethereum. For instance, I've staked my paltry amount on Coinbase with their Ethereum 2 token, and when the network transitions it'll go toward staking and I'll earn "mining" rewards without having to run a mining machine.

very good summary afaik.

 

[BMcL]

Price of oil is driving inflation ($85) and interest rates are climbing. Market down ~ 500.
Crypto is hanging in there; down just a little.
Expect gas prices to climb some more.

 

[Sanwizard]

Price of oil is driving inflation ($85) and interest rates are climbing. Market down ~ 500.
Crypto is hanging in there; down just a little.
Expect gas prices to climb some more.

Just bought more BTC, ADA, and ETH. When the stock market goes down 500, and the cryptomarket moves up, we finally have the divergence I was looking for. Everyone is going to need an alternative to the stock market as it plunges with the reality of the money printed inflation bubble.
They cannot print more Bitcoin, and DeFi is moving fast.

 

[BMcL]

I'm looking for a much bigger drop but I don't see it coming anytime soon.

Unless oil hits $100+ ; I think that could send the market down 10% , maybe more