This is opinion editor Bernardo Filipe, lifelong thinker, philosopher and author of The Straight Science.
“Non-profitable assets with no residual value are problematic.
The result is that due to the lack of any obvious income benefiting the bitcoin holderif we expect that future value will be zero when miners become extinct, the technology becomes obsolete, or future generations enter other such “assets” and bitcoin loses its appeal to them.after should have a value zero Now.” – Nassim Taleb
If mainstream bitcoin adoption is successful, it will automate much of our financial structure with the help of power plants, energy and computers. At the very least, it will create a parallel system to the existing banking system and therefore be protected from the latter’s crashes (see 2007-2008). economic crisis). Of course, it will take years for this new system to fully mature. Taleb says that this mission is worth exactly zero because he has no vision.
Is It a Good Time to Invest in Bitcoin? I believe it is. Not many, except the right philosophers who have thought for centuries, except the best wealth managers who have thought for decades, can form such a belief.
So philosophers, who historically never cared about wealth, and wealth managers, who were naturally interested in sufficient wealth, come together at an interesting turn of events. Philosophers see that humanity’s inevitable destiny is to become a cybernetic organism, and they see that any technology that facilitates this process will surely dominate. And wealth managers realize that a thermodynamically closed alternative financial system can be beneficial to their operations.
That’s all there is to say about it. But I can say more.
Because there are indeed other ideas in the market, but they are mostly irrelevant. For example, there’s Nassim Taleb, a confused man who writes 300-page books about nonsensical ideas that can be summed up in a single paragraph. He talks about “black swans” as if we didn’t already know that the scientific model is just a rough sketch, not a crazy bible. He literally wrote 300 pages about it – that you can’t accurately predict any event with 100% certainty, and that accidents and disasters do happen. Only instead of calling these events accidents or disasters, he called them “black swans.” In prose that is utterly irritating italicsmoreover, literally italicization hour at least a word each paragraphIf not sentence. Also gratuitously quoting and naming intellectuals for no reason. So why did people pay attention to him again? Because he made a fortune trading options. Nassim Taleb believes in bitcoin exactly zero value and the fall in the price of bitcoin in March 2020 “proves” that it cannot be used for hedging (as if all risks were equal and diversification is not the best overall hedge against risk) once and for all, he doesn’t understand his book. You can’t “prove” anything from a single data point, dear Taleb. The March 2020 lockdown was an oddity—an exception—a “black swan” to adopt your terminology. If you had been paying attention, you would have seen the entire market collapse as well, and maybe you would have realized that you can’t extrapolate anything worthwhile about bitcoin at this stage. But Taleb says bitcoin has crashed more than the stock market — which is why he thinks “bitcoin is worthless.” Now we move from child terminology to child logic.
But what is his mistake here? The problem is that he failed to realize that bitcoin is still in development, still growing and evolving. His mistake is the equivalent of watching a healthy cat kill a newborn lion and then concluding from this strange observation that cats are stronger than lions. He seems to think that bitcoin’s future behavior will mirror its current behavior, but how can that be when we’re so early? It’s so early that there’s no regulation for it, and most people are still trying to figure out what exactly bitcoin is. That is, practically no one knows what bitcoin is. Taleb, then, ignores in his analysis the idea that bitcoin’s maximum utility depends on widespread adoption in the future. It myopically analyzes bitcoin at the moment, completely ignoring the impact of the future. convenient conditions in his analysis, as if today bitcoin was already a finished product and process. But this is not the case, because bitcoin is designed to connect itself cyber-symbiotically with humanity, and the portion of humanity it currently connects itself to is not significant enough in terms of raw wealth and investment power.
For Nassim Taleb, bitcoin works like a Ponzi scheme, but I say it’s only going to look like a Ponzi if it doesn’t mature. Otherwise, it won’t be anything like a Ponzi and will look like an extremely awesome asset with a huge benefit. I can also say that most life on planet earth is a “Ponzi” because in a few billion years the sun will expand and destroy the entire planet, like destroying all the property on it. Then real estate wallet owners can say that real estate investing is always a Ponzi, especially after seeing every bitcoin owner move their bitcoin safely off the planet. What exactly is a Ponzi in this scenario? Thus, we see that Talib’s quote above makes no sense: in a sufficiently advanced future, everything is destined to go down to zero, but that certainly doesn’t mean that nothing has value.
We are currently entering bitcoin’s “maturity” phase (well past ten years of its infancy), the final and long-term phase that will reduce price volatility and effectively bring its value potential to the table. Can this phase not end? Of course. In nature, life forms sometimes fail to mature. This does not prevent me, or any human being, from trying to imagine what a particular life form might look like and behave like if favorable conditions were to arise that would guarantee its prosperous development. This, of course, is the basic idea of biology. However, in the technological realm, the same principles of biological and evolutionary thinking can be applied, as tools are created, grow, mutate, collide with each other, and eventually evolve or become obsolete in ways similar to life forms on Earth. nature; only in the technological field is humanity dictating the fate of the tool, and in the biological field is nature. The thing is, this “maturity” stage I’m referring to is, of course, in the case of bitcoin, the “Bitcoin mass adoption” stage: the stage where all valuable wealth managers agree and decide that bitcoin’s rules are great. playing by them—putting a small portion of their capital into it initially—and gradually but steadily adding more as they see fit. Because it will be this phase that will fully accelerate the cybernetic symbiosis between Bitcoin and humanity.
Currently, bitcoin is useful for wealth transfers and that’s about it. However, bitcoin could potentially, i.e. theoretically, be more useful than it currently is under the right circumstances. Because we envisage radical optimization of the entire financial structure with the help of automation. Dear Taleb , we’re betting on this future, higher benefit – and so we couldn’t care less about volatility or fragility or “prominent skewed responses to stressors” now. I know you wrote a whole book about randomness and even tried to come up with a theory to use randomness to our advantage. But at the end of the day, this whole theoretical endeavor is pointless, because the purpose of theory is to predict the future, and randomness is defined as something that cannot be precisely predicted. Of course, yes, of course we want to minimize the harmful effects of randomness (=chance,=accidents, =disasters). This is called risk management. But until an unpredictable accident (see pleonasm?) actually happens, no one knows how fragile our process-activity asset is relative to said accident—otherwise the event would not be an accident by definition, and we would. to incorporate it into our theories and models! But you not only don’t see this nonsense, you even lecture about it, as if randomness is somehow understandable, as if we haven’t seen it yet. determined as incomprehensible! And it’s as if the book’s message wasn’t obvious, but something profound, as obvious as saying the sky is blue or that birds fly.
If you think I’m being too harsh on Taleb, dear reader, let me tell you that this is the answer he wanted when he started quoting philosophers for hundreds of pages in a row for no apparent reason. He appealed to the spirit of philosophy – so now it bites him – a proper example of the wizard turning the wizard against the caster. I hope you like it, Taleb!
So that’s it. Philosophers, wealth managers and a few visionaries agree that bitcoin is awesome. Then there’s the rest of humanity who don’t care about these things. Finally, there are thinkers like Nassim Taleb who don’t think right. In short: the potential gains far outweigh the ridiculously low risk of bitcoin going to zero, in my opinion.
This is a guest post by Bernardo Filipe. The views expressed are entirely their own and do not necessarily reflect the views of BTC Inc or Bitcoin Magazine.