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I know a tiny bit about cryptocurrency and am willing to help others get into it AMA

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  • MyrmidonMyrmidon Baron von Puttenham California Icrontian
    edited 3 Feb

    @EMT said:
    ...As well as the odd craigslist seller who accepts...

    The craigslist seller really isn't at risk. It's the buyer. The seller would say something like 'send the funds, and once they're confirmed six blocks in, I'll give you the thing.' So the buyer has to do the transaction, and the SELLER is the one who can get cold feet and not send the product. If the funds are confirmed a few blocks in, transaction fraud is impossible at that point (unless you are the owner of 51% of the mining power on the blockchain, or are part of an impossibly tightly coordinated sting with better-than-lottery luck involving a massive chunk of the mining power on the blockchain or something, at which case, People Will Notice).

    I keep circling back to the idea of wire transfers as analogues to BTC. Would you use a wire transfer to buy something on craigslist? If not, don't use BTC for it. Wait 'til something like the Lightning network gets off the ground. Or until there's a good escrow service similar to paypal.

  • ThraxThrax Professional Shill, Watch Slut, Mumble Hivemind Drone Austin, TX Icrontian

    I treat crypto like a free stock I don't care about. I make money, I lose money. I rarely bother with diversifying. I don't trade it into other commodities. I don't buy more.

    I cash out when it feels good.

    Myrmidon
  • primesuspectprimesuspect Beepin n' Boopin Detroit, MI Icrontian

    I don't have a strategy. I'm not investing for real; I'm using play money (under $50) and treating it like a video game. I sell and buy based on emotion.

  • EMTEMT Seattle, WA Icrontian

    Do you all try to avoid fees for deposit/withdrawal/trade or does it not really matter when you consider the money to be gone?

    Looks like you can avoid most fees by going with GDAX for your exchange site, but it takes over a week to get USD in there to get started. You also have to give them your driver's license, is that concerning?

  • PirateNinjaPirateNinja I don't know how to not Icrontian

    @Myrmidon
    I got in to an interesting discussion with my brother, and I was trying to figure out exactly what portion of the world's current financial systems bitcoin would replace were it to become an established currency.

    The best we could come up with was that the portion of financial transactions managed by payment processors like Visa, Amex, etc, would be eliminated. But all other systems would remain the same (merchant banks that issue debit/credit cards, transactions recorded on each end, banks provide debt, and etc)

    Curious if you have a few minutes and are bored if this sounds right to you, or if you can think of any other financial systems bitcoin would impact.

  • EMTEMT Seattle, WA Icrontian

    Be careful trading small amounts with Binance. It's an exchange that has a coin I wanted. After sending ~$6 of crypto there, come to find out, I need $10+ worth to trade at all, and if I pull it back to Coinbase instead, I lose over $1.

    There's a pretty deep rabbit hole of different exchanges × many fees to navigate, if you want to get in on a variety of obscure coins.

  • MyrmidonMyrmidon Baron von Puttenham California Icrontian
    edited 12 Mar

    @PirateNinja said:
    @Myrmidon
    I got in to an interesting discussion with my brother, and I was trying to figure out exactly what portion of the world's current financial systems bitcoin would replace were it to become an established currency.

    The best we could come up with was that the portion of financial transactions managed by payment processors like Visa, Amex, etc, would be eliminated. But all other systems would remain the same (merchant banks that issue debit/credit cards, transactions recorded on each end, banks provide debt, and etc)

    Curious if you have a few minutes and are bored if this sounds right to you, or if you can think of any other financial systems bitcoin would impact.

    Sorry, not sure how I missed this. As always, I am a hobbyist, not an expert, and my info comes from my understanding of the original satoshi white-paper, so vet any statement you're REALLY interested in as you would with any other interesting info. Anyway:

    I mean... it's probably not as exciting to consider what financial systems it'll upset, because honestly, not many. In some far flung future where BTC is treated like currency and not commodity, then it mostly fulfills the same role as cash in a bank. Want to do a wire transfer? BTC is fastest and incredibly cheaper (honestly, it's ALREADY faster and incredibly cheaper than a wire). Want to pay for something at a store? Credit account is most convenient. Need to pay your creditor? Your bank can probably make that transfer faster and cheaper than BTC, because your bank probably has a reputation with your creditor. Don't want to use a credit account to pay for something in a story? Use paper cash, because it's literally already in your hand.

    Like... if we're really stretching here, maybe people would keep BTC 'bank accounts,' basically wallets that the banks hold the private keys to... that might reduce a lot of financial overhead for the banks, and allow banks artificially 'speed up' authorized transactions to creditors, but there's probably not much of a benefit for a consumer over any other damn bank, beyond having your money in BTC vs a fiat currency.

    And... none of that is very exciting. BTC as a replacement just isn't very exciting.

    I may have already said this (I'm too lazy to scroll up and it's been, like, a month or whatever), but some folks you'll talk to will tend to say 'well, sounds like BTC doesn't replace cash very well,' which is kind of like saying 'well, sounds like a screwdriver doesn't really replace a hammer very well.' Nope. It's a different tool. It's main selling point is its decentralization - which is really exciting to libertarians. No government agency has direct power over the amount of BTC in existence, and therefore can't exert control on a BTC economy in the conventional methods (ie, printing or destroying fiat currency). If no government backs BTC, then BTC can be worth the same in spain and portugal and chile and poland as it is here. It has the ability to be worldwide currency, which is a big goddamn deal - if no country controls it, then no country can exert control over another country (or its citizens) by changing supply (that possibility is one reason it's so hard to introduce a traditional universal currency). Additionally, it gives users an amount of pseudo-anonymity when paying or transferring funds, and all the benefits - or detriments, depending on your viewpoint - that go with that. These are properties that don't directly relate to 'replacing' anything in the financial field - they're just new properties that necessitate a different viewpoint on finance in general.

    But fuck that. While BTC is pretty incredible, it's not really the pot of gold at the end of the rainbow... BTC is just what everyone sees because everyone in our dumb culture is obsessed with money. What's more incredible is the technology it's built on - BTC championed the concept of a blockchain, and really pushed the idea of a properly decentralized network. BTC can crash to $0, but it's already changed the world in a massive way. The financial sector can eliminate tons of overhead by implementing their own centralized blockchain network to create a cash-transfer system, if they wanted. The Etherum and Sia networks have the potential to revolutionize escrow systems and data storage in a massive way. The potential applications of the invention of the blockchain represent a really significant software frontier.

    @EMT said:
    Be careful trading small amounts with Binance. It's an exchange that has a coin I wanted. After sending ~$6 of crypto there, come to find out, I need $10+ worth to trade at all, and if I pull it back to Coinbase instead, I lose over $1.

    There's a pretty deep rabbit hole of different exchanges × many fees to navigate, if you want to get in on a variety of obscure coins.

    Trading small amounts is probably not super wise. While I can't speak for exchanges (and, honestly, I only use exchanges when I'm transferring from crypto to fiat... I use shapeshift for crypto-to-crypto exchanges), technically speaking for the NETWORK, fees are not based on the amount of value traded, they're usually based on the amount of data converted from input to output. For instance, if you've received one million one-bit transfers (totaling 1BTC) and went to transfer the resulting 1BTC to a wallet, your fees would be astronomical. That's a lot of inputs to process into one output. However, if you received two five-BTC transfers (totaling 10BTC), your fee would probably amount to, like $0.80. Soooooooo yeah, small-ass amounts don't make a lot of sense. To compare it to the pre-existing stock market, however, let's not forget that traditional ebrokers in the traditional stock market say shit like 'trades AS LOW AS $4.95.' Would you put $6 worth of stock into the stock market to 'play around with,' given THOSE fees? So at least there's an historical precedent for 'don't trade with small amounts...'

    If you're not looking to put real money into crypto via an exchange, maybe just find a clever way to mine something like zcash with nicehash in your spare time, and trade that for the cryptos you want... you might end up paying more on your power bill, but hey, maybe you charge your gaming (mining) laptop at work, or you only mine tethered from your phone when you're in a coffee shop... or maybe power's dirt cheap and you let your gaming rig do the mining at night and use it as a space heater a la legacy @UPSLynx . Either way, you'll rack up more than $6 fairly quickly, and not have to feel ridiculous because you got charged a more-than-10% fee for your trade xD

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