As the AI market continues to balloon, experts are warning that its VC-driven rise is eerily similar to that of the dot com bubble.

  • qaz@lemmy.world
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    1 year ago

    NFTs yes but crypto is absolutely not a bubble. People are saying that for decades now and it hasn’t been truth. Yes there are shitcoins, just like shitstocks. But in general, it’s definitely not a bubble but an alternative investing method beside stocks, gold etc.

    What is the underlying mechanism that increases its value, like company earnings are to stocks? Otherwise, it’s just a reverse funnel scheme.

    • higgs@lemmy.world
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      1 year ago

      What’s the underlying mechanism that gives money a value? We the humans give money and gold a value because we believe they’re valuable. Same with crypto. Bitcoin is literally like gold but digital. Stop saying what everyone without knowledge says and inform yourself. Not only about crypto, also about money etc.

      If you don’t understand the fundamentals of money, how can you judge something of being scam. There are lot of people here who didn’t even understand how money and gold works.

      • bigschnitz@lemmy.world
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        1 year ago

        Money has value insofar as governments use it to collect tax - so long as there’s a tax obligation, there’s a mandated demand for that currency and it has some value. Between different currencies, the value is determined based upon the demand for that currency, which is essentially tied to how much business is done in that currency (eg if a country sells goods in its own currency, demand for that currency goes up and so does it’s value).

        This is not the same for crypto, there are no governments collecting tax with it so it does not have induced demand. The value of crypto is 100% speculative, which is fine for something that is used as currency, but imo a terrible vehicle for investment.

        • higgs@lemmy.world
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          1 year ago

          You are right in that it increases people’s belief in money because it is the primary source of revenue for states. But if the majority of people did not believe in the piece of paper, it would be worth nothing. That is the fundamental value of money as we know it.

          There have been states where stones were the currency simply because the inhabitants believed in them.

          • Sludgeyy@lemmy.world
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            1 year ago

            Gold Standard

            Linking money to a material with intrinsic value for it’s value

            Gold has intrinsic value

            US Dollar moved to be a Fiat Currency

            US Dollar is backed by a Government

            Crypto has zero intrinsic value, not linked to anything with intrinsic value, and not backed by a Government

            Crypto is an imaginary “item” some people want to have valve. Value is created because of this want.

            US Dollar is legal tinder for all US debts, Crypto is not

            Crypto is not a currency but a digital commodity

            • jose423@lemmy.jgholistic.com
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              1 year ago

              Money and gold have value because they can be exchanged easily for goods and services that are really wanted. As long as crypto currencies make it hard to trade for goods ands services, they will be, at best, a fad, at worst, a scam. There needs to be market for crypto to work. All I see is promises, no real commitments to it.

              • Devccoon@lemmy.world
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                1 year ago

                All I ever see around crypto is this vague notion that it could someday be acknowledged and used widely as real money is. But so could bottle caps. I don’t see the mechanism for how it realistically happens. It’s no less a moonshot than it was 3 years ago, IMO.

                Just because a lot of people are buying into crypto doesn’t make the underlying inefficiencies in its design (depending on the coin) disappear and make way for common usage. As it stands now, cryptocurrencies are basically glorified ponzi schemes. The people nonstop defending them deserve to be treated with constant skepticism because they have skin in the game and know there’s nothing preventing them from losing it all. It’s in their best interest to believe in it and spread that belief.

                • Freesoftwareenjoyer@lemmy.world
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                  1 year ago

                  You are forgetting that cryptocurrency has real uses. You can send money to people without using a bank or PayPal. I use it to pay for things online anonymously and being able to do that is very valuable to me and to other people. You can use crypto to buy a gift card for any store if they don’t accept crypto directly.

                  I have nothing to gain by saying this, since I don’t keep any significant amount of money in crypto. I don’t care what the price of Bitcoin or another coin is. It’s irrelevant and doesn’t affect my ability to use this technology.

                  Cryptocurrency is not a scam. It’s just a distributed ledger.

                  • Sludgeyy@lemmy.world
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                    1 year ago

                    Anonymous…

                    Distributed ledger…

                    It’s not really anonymous.

                    John Smith or 253832893 means exactly the same thing without more context. The only way you can tell you have the right John Smith is because we have 253-83-2893 as a social security number (lol social security system).

                    But if I see 253832893 on the Crypto ledger, I know 253832893 made a transaction. It could say John Smith and I’d be basically in the same spot of figuring out who it was.

                    Now, if 253832893 wallet paid a home mortgage for John Smith with Crypto, then I’d be closer to figure out who owns 253832893 wallet.

                    The whole point to Crypto is the block chain and the fact that they are very traceable.

                    Crypto can be anonymous if you’re smart and you don’t link yourself to your wallet. But once you are linked to a wallet, it is far from anonymous.

                    If John Smith wanted to sell me cocaine. Handing him cash is basically untraceable and anonymous. Sending him Crypto ties my wallet to his wallet with a transaction. If the cops seized his wallet and somehow figured out my wallet, they could tell every single time I purchased cocaine from him.

                    Yes, you can do your best to keep your name unlinked to your wallet number. But it’s not foolproof. For example, if I was buying cocaine I wouldn’t use my main Crypto wallet but a side wallet. If you only used it to pay for cocaine and filled the side wallet in an untraceable way. It’s pretty anonymous.

                    But to those people that fill their Crypto wallets with their bank account and just think they are anonymous, they have another thing coming if someone wants to trace them.

          • SCB@lemmy.world
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            1 year ago

            Money is a physical representation of the concept of value. Saying “what gives money value” is like asking “why does rain make clouds.”

            This is why printing money decreases the value of the currency - the value it represents has not changed so the value is diluted across the currency as the amount of currency expands.

        • Freesoftwareenjoyer@lemmy.world
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          1 year ago

          I don’t know if it’s good investment or not, but cryptocurrency has uses that are valuable to a lot of people. You can send money to other people without using a bank or PayPal and you can pay for things online anonymously. Some cryptocurrencies might have additional properties like Monero, which also gives you privacy. NFT might also have practical uses some day - for example it could be used for concert tickets.

      • aesthelete@lemmy.world
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        1 year ago

        What’s the underlying mechanism that gives money a value?

        A) the government backing it up along with its advanced military

        B) the fact that you have to pay taxes in it