It seems like a good idea to collect self-reports about why LessWrongers didn’t invest in Bitcoin. For my own part, off the top of my head I would cite:
less visible endorsement of the benefits than e.g. cryonics;
vaguely sensing that cryptocurrency is controversial and might make my taxes confusing to file, etc.;
and reflexively writing off articles that give me investment advice because most investment advice is bad and I generally assume I lack some minimal amount of wealth needed to exploit the opportunity.
So something like We Agree: Get Froze,might have helped. I also could have actually evaluated the difficulty of filing taxes given that I’d purchased bitcoins, instead of flinching away and deciding it was too difficult on the spot. I could pay more attention to figures that are relatively small even for someone with little wealth.
If surveys are still being done, that seems like important data to collect on the next survey. I would want to know if most people knew but didn’t invest, or simply didn’t know at all, and so on.
I didn’t invest in Bitcoin because I don’t invest in things that I don’t understand well enough to be confident that the Efficient Market Hypothesis doesn’t apply. I continue to believe this is a rational choice—okay, sure, this one time I might have made a lot of money, but most of the time I would waste a bunch of money/time/other resources. And no one writes blog posts about how they could have lost a lot of money but didn’t, so the availability heuristic is going to overweight successes.
okay, sure, this one time I might have made a lot of money, but most of the time I would waste a bunch of money/time/other resources.
This seems like a good heuristic, but is it actually true that Bitcoin was an undifferentiated member of an extremely large class? I agree that the availability heuristic is very important here, but I’m struggling to think of a single thing in the same reference class (maybe cryonics? MIRI? Nootropics?). If anyone can give me examples of “stuff lots of people on LessWrong liked that could have huge payouts”, that would be much appreciated.
As someone who made a profit investing in Bitcoin I endorse and encourage your decision. I definitely want to avoid this somehow turning into “rationalists should win by trying to jump on every crazy make-money-fast scheme because one of them could be the next Bitcoin.” If it’s the case that rationalists should have been able to predict Bitcoin’s success, we should focus on specific factors that indicated there was something there to be gotten.
I can talk now about all the smart people I know who believe in Bitcoin as a reason to want to keep it, but I didn’t know any of those people yet when I first bought it—I met them along the way. It’s hard for me to remember what it was that attracted me to it at the time. I think it had a lot to do with the way the technology played into my own specific vision for the future of tech, which is very personal and not necessarily portable to an arbitrary person in the rationalosphere (in terms of reasons to have believed in Bitcoin at the time.)
For my part, it was one part trivial inconveniences, one part that it read like woo. I was aware it existed through other avenues (I wasn’t a Less Wronger then), and aware of what it was trying to do, and I had the technical acumen to get in on it if I had so chosen. Given that, I’m a little bitter that I didn’t do so. I could retire today if I had. I could get into it today, of course, but now that everybody knows it’s a magic money making machine I suspect a bubble is well underway. I don’t want to be in when it breaks.
I’m a little worried about Bitcoin’s externalities. The mining process consumes more and more energy, and professional miners are driving up hardware costs. Which might be fine if most transactions were, well, transactions, i.e. if we’re getting human value out of the work. But I get the impression that the vast majority of the network’s effort goes towards playing musical chairs with money, and that seems bad.
Bitcoin doesn’t feel woo-ish, anymore, but it’s starting to feel paperclippy instead.
Yes, paperclippy. And also bitcoin network is equal to 10E23 flops now (but cant’t do anything else except bitcoinclips), which is 60 times more than total computational power of all other computers combined, which was estimated by Grace. It is really mindbending and astronomical amount of computations, and it doubles every 8 months. And it pays people for its construction.
I notice I am confused. 60 times more than all other computers combined would imply that >98% of human compute capacity is tied up in the bitcoin network. That seems...unlikely.
The figure’s misleading, because mining (these days) is done with specialised hardware: ASICs, chips dedicated to calculating SHA256 hashes (or whatever algorithm your favourite coin uses), which can calculate those approx.105 times times faster (per second per $) than a general-purpose CPU—but can’t do anything else.
So that implication may well be true in the sense that if all the worlds computers turned to mining bitcoin, the total mining capacity would only be increased by a couple percent over what it is at the moment (due to general-purpose computers being so inefficient at specific tasks compared to dedicated hardware). But false in the sense that very little of the world’s general-purpose compute capacity is tied up mining cryptocurrency.
I’m a little worried about Bitcoin’s externalities.
I think most such worries are not well-founded, but I would also like to point out that “Bitcoin seems like it might eat the world in a bad way” is not exactly a reason not to invest. It might be a reason to fight against Bitcoin, but if you’re not fighting against it, it seems like precisely a reason you would want to buy it.
It seems like a good idea to collect self-reports about why LessWrongers didn’t invest in Bitcoin. For my own part, off the top of my head I would cite:
less visible endorsement of the benefits than e.g. cryonics;
vaguely sensing that cryptocurrency is controversial and might make my taxes confusing to file, etc.;
and reflexively writing off articles that give me investment advice because most investment advice is bad and I generally assume I lack some minimal amount of wealth needed to exploit the opportunity.
So something like We Agree: Get Froze,might have helped. I also could have actually evaluated the difficulty of filing taxes given that I’d purchased bitcoins, instead of flinching away and deciding it was too difficult on the spot. I could pay more attention to figures that are relatively small even for someone with little wealth.
If surveys are still being done, that seems like important data to collect on the next survey. I would want to know if most people knew but didn’t invest, or simply didn’t know at all, and so on.
I didn’t invest in Bitcoin because I don’t invest in things that I don’t understand well enough to be confident that the Efficient Market Hypothesis doesn’t apply. I continue to believe this is a rational choice—okay, sure, this one time I might have made a lot of money, but most of the time I would waste a bunch of money/time/other resources. And no one writes blog posts about how they could have lost a lot of money but didn’t, so the availability heuristic is going to overweight successes.
This seems like a good heuristic, but is it actually true that Bitcoin was an undifferentiated member of an extremely large class? I agree that the availability heuristic is very important here, but I’m struggling to think of a single thing in the same reference class (maybe cryonics? MIRI? Nootropics?). If anyone can give me examples of “stuff lots of people on LessWrong liked that could have huge payouts”, that would be much appreciated.
As someone who made a profit investing in Bitcoin I endorse and encourage your decision. I definitely want to avoid this somehow turning into “rationalists should win by trying to jump on every crazy make-money-fast scheme because one of them could be the next Bitcoin.” If it’s the case that rationalists should have been able to predict Bitcoin’s success, we should focus on specific factors that indicated there was something there to be gotten.
I can talk now about all the smart people I know who believe in Bitcoin as a reason to want to keep it, but I didn’t know any of those people yet when I first bought it—I met them along the way. It’s hard for me to remember what it was that attracted me to it at the time. I think it had a lot to do with the way the technology played into my own specific vision for the future of tech, which is very personal and not necessarily portable to an arbitrary person in the rationalosphere (in terms of reasons to have believed in Bitcoin at the time.)
For my part, it was one part trivial inconveniences, one part that it read like woo. I was aware it existed through other avenues (I wasn’t a Less Wronger then), and aware of what it was trying to do, and I had the technical acumen to get in on it if I had so chosen. Given that, I’m a little bitter that I didn’t do so. I could retire today if I had. I could get into it today, of course, but now that everybody knows it’s a magic money making machine I suspect a bubble is well underway. I don’t want to be in when it breaks.
I’m a little worried about Bitcoin’s externalities. The mining process consumes more and more energy, and professional miners are driving up hardware costs. Which might be fine if most transactions were, well, transactions, i.e. if we’re getting human value out of the work. But I get the impression that the vast majority of the network’s effort goes towards playing musical chairs with money, and that seems bad.
Bitcoin doesn’t feel woo-ish, anymore, but it’s starting to feel paperclippy instead.
Yes, paperclippy. And also bitcoin network is equal to 10E23 flops now (but cant’t do anything else except bitcoinclips), which is 60 times more than total computational power of all other computers combined, which was estimated by Grace. It is really mindbending and astronomical amount of computations, and it doubles every 8 months. And it pays people for its construction.
I notice I am confused. 60 times more than all other computers combined would imply that >98% of human compute capacity is tied up in the bitcoin network. That seems...unlikely.
The figure’s misleading, because mining (these days) is done with specialised hardware: ASICs, chips dedicated to calculating SHA256 hashes (or whatever algorithm your favourite coin uses), which can calculate those approx.105 times times faster (per second per $) than a general-purpose CPU—but can’t do anything else.
So that implication may well be true in the sense that if all the worlds computers turned to mining bitcoin, the total mining capacity would only be increased by a couple percent over what it is at the moment (due to general-purpose computers being so inefficient at specific tasks compared to dedicated hardware). But false in the sense that very little of the world’s general-purpose compute capacity is tied up mining cryptocurrency.
What are you referring to here?
I think most such worries are not well-founded, but I would also like to point out that “Bitcoin seems like it might eat the world in a bad way” is not exactly a reason not to invest. It might be a reason to fight against Bitcoin, but if you’re not fighting against it, it seems like precisely a reason you would want to buy it.
Individual incentives to back something collectively terrible seems like textbook Moloch to me.
(which doesn’t imply that you’re wrong, of course)