Prediction markets are a little like bitcoin. In order for bitcoin to function securely participants must waste an enormous amount of electricity and money on mining; a postgres database could process many more transactions per second at much less cost. But one advantage of the bitcoin protocol over postgres is that it allows everyone to verify fair operation, even when some participants are untrustworthy and would prefer to double-spend or modify account values.
Similarly, prediction markets are a way to get good community consensus on something, in the limit of market subsidy, in the presence of liars and idiots. But that’s different from saying that starting a prediction market is the most cost-effective way to gather information on the events you want.
In order for bitcoin to function securely participants must waste an enormous amount of electricity and money on mining; a postgres database could process many more transactions per second at much less cost.
This alone basically made bitcoin flop hard, because it required ridiculous amounts of energy and it grew exponentially more expensive to be a useful alternative like currency, and it got so bad that Kazakhstan had protests over just how much electricity prices shot up because of it’s energy being used for cryptocurrency trading.
Note, this doesn’t address the many other severe flaws with bitcoin or cryptocurrency in general, but this alone basically underscored how much bitcoin couldn’t ever work to even be a helping hand for stuff like databases, let alone replace the centralized entity, because energy is expensive, and you always want to reduce the amount you use to help use energy for other useful things.
Potentially, but that would require a lot of bitcoin people to admit that government intervention in their activity is at least sometimes good, and given all the other flaws of bitcoin like having irreversible transactions, it truly is one of those products that isn’t valuable at all in the money role except in extreme edge cases, and pretty much all other inventions had more use than this, which is why I think that in order for crypto to be useful, you need to entirely remove the money aspect via some means, and IMO, governments are the most practical means of doing so.
Maybe killed is an overstatement, but it definitely flopped hard, and compared to the expectations that bitcoin and crypto advocates were claiming, it definitely failed, and it didn’t even work for almost every use case proposed by bitcoin/general cryptocurrency advocates.
The fact that the price number goes up is a testament to how much speculation can prop up bubbles, even when they’re based on nothing or at best much less valuable, plus the Fed loosening it’s interest rate policy means that they can party again with cheaper money.
I dunno I still think Bitcoin is actually a good store of value and hedge against problems in fiat currency. Probably as good a bet as gold as this point.
Compared to what? My guess is it’s a better bet than most currencies during that time, aside from a few winners that it would have been hard to predict ahead of time. E.g., if 200 years ago, you had taken the most powerful countries and their currencies, and put your money into those, I predict you’d be much worse off than gold.
200 years ago was 1824. So compared to buying land or company stocks (the London and NY stock exchanges were well established by then) or government bonds.
Some quick calculations from chatGPT puts the value from a british government bond (considered the world power then) at about equal to the value of gold, assuming a fixed interest rate of 3% with gold coming out slightly ahead.
I haven’t really checked these calculations but they pass the sniff test (except the part where chatGPT tried to adjust todays dollars for inflation).
Prediction markets are a little like bitcoin. In order for bitcoin to function securely participants must waste an enormous amount of electricity and money on mining; a postgres database could process many more transactions per second at much less cost. But one advantage of the bitcoin protocol over postgres is that it allows everyone to verify fair operation, even when some participants are untrustworthy and would prefer to double-spend or modify account values.
Similarly, prediction markets are a way to get good community consensus on something, in the limit of market subsidy, in the presence of liars and idiots. But that’s different from saying that starting a prediction market is the most cost-effective way to gather information on the events you want.
This alone basically made bitcoin flop hard, because it required ridiculous amounts of energy and it grew exponentially more expensive to be a useful alternative like currency, and it got so bad that Kazakhstan had protests over just how much electricity prices shot up because of it’s energy being used for cryptocurrency trading.
Note, this doesn’t address the many other severe flaws with bitcoin or cryptocurrency in general, but this alone basically underscored how much bitcoin couldn’t ever work to even be a helping hand for stuff like databases, let alone replace the centralized entity, because energy is expensive, and you always want to reduce the amount you use to help use energy for other useful things.
Couldn’t they just tax bitcoin mining and come out ahead overall?
Potentially, but that would require a lot of bitcoin people to admit that government intervention in their activity is at least sometimes good, and given all the other flaws of bitcoin like having irreversible transactions, it truly is one of those products that isn’t valuable at all in the money role except in extreme edge cases, and pretty much all other inventions had more use than this, which is why I think that in order for crypto to be useful, you need to entirely remove the money aspect via some means, and IMO, governments are the most practical means of doing so.
Bitcoin is at 44k rn idk man
Maybe killed is an overstatement, but it definitely flopped hard, and compared to the expectations that bitcoin and crypto advocates were claiming, it definitely failed, and it didn’t even work for almost every use case proposed by bitcoin/general cryptocurrency advocates.
The fact that the price number goes up is a testament to how much speculation can prop up bubbles, even when they’re based on nothing or at best much less valuable, plus the Fed loosening it’s interest rate policy means that they can party again with cheaper money.
I dunno I still think Bitcoin is actually a good store of value and hedge against problems in fiat currency. Probably as good a bet as gold as this point.
Narrator: gold has been a poor bet for 90% of the last 200 years.
(Don’t quote me on that, but it is true that gold was a good bet for about 10 years in recent memory, and a bad bet for most post-industrial time)
Compared to what? My guess is it’s a better bet than most currencies during that time, aside from a few winners that it would have been hard to predict ahead of time. E.g., if 200 years ago, you had taken the most powerful countries and their currencies, and put your money into those, I predict you’d be much worse off than gold.
200 years ago was 1824. So compared to buying land or company stocks (the London and NY stock exchanges were well established by then) or government bonds.
Some quick calculations from chatGPT puts the value from a british government bond (considered the world power then) at about equal to the value of gold, assuming a fixed interest rate of 3% with gold coming out slightly ahead.
I haven’t really checked these calculations but they pass the sniff test (except the part where chatGPT tried to adjust todays dollars for inflation).