Thursday, March 4, 2021

Why BTC?

I’ve been trying to get my friends and family members into adding some bitcoin to their traditional investments the last couple of months. They seem to have general interests especially given its recent performance and influx of institutions commenting on it but there they still have some questions. Any help answering them and getting some more information would be extremely helpful!

  1. I don't see how buying a house or lambs without a 3 party is more beneficial? Wire cost $25 and funds are held by an insured escrow party like the title insurance company who verify funds are in place and deeds are proper in form and will take the liability to properly record that interest. For securing payment, okay, but why would a wire or bank check or letter of credit not suffice? Also, if it has evolved from p2p what has it or what will it evolve into? If it's not for p2p then what is the demand that will keep the value pushing higher (limited supply needs demand)? Or demand to keep computing power available? My ultimate question I'm asking is what is the endgame for btc? Year 2040 no more being mined. What does the world look like with btc?

  2. We have escrow services already for legal goods. I don't understand how btc solves this? Can I do chargeback or fraud protection or extended warranty like with credit cards?

  3. Lightning fee is less secure. So for small related transactions seems okay but any charges as cost of transaction buyer has to pay will be frowned upon. Like buyer paying a fee for coffee, not the coffee shop. Imagine if coffee shop asked you pay merchantile fee. That's why seller/stores eat the merchantile fees. Do you think cost of retail goods will be lowered if btc is used? Seems unlikely they will pass that savings on. Also for larger purposes one may want a secure block those fees would higher than current fees e.g. Wire or bank check.

  4. How is store of value achieved if demand is based on p2p?

  5. https://bitinfocharts.com/comparison/bitcoin-transactionfees.html

https://ycharts.com/indicators/ethereum_average_gas_price

  1. So many altcoins and central banks from other countries have released or plan to release there own. How does btc stand alone with so many alternatives? How does it maintain an edge?

  2. The case for btc for illegal good is easy to make. Used to be cash or works of art would be used but as cash goes down, more and more is needed or need an art appraisal to verify real deal. Billions of value could now fit in your pocket and can be sent from anywhere anonymously. Why would govts allow this type of structure to exist unless 1. they owned it or 2. They taxed it heavily. A hypothetical case to ban would be a 9/11 event funded by btc or cartels using btc for weapons drugs.

I'm having trouble figuring the user need for btc p2p. Seems like strategy is to just hold it and then at some point swap it for cash other asset (real estate) if that's possible. Who is using it for transactions then? Is the only long term value derived from everyone just holding furthering shorting supply due to little demand?


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