But instead it turned into a game of "hodl" to get rich.
Scams were openly perpetrated in the forums.
I became completely disillusioned. What exactly does bitcoin offer the world today?
Aside from perhaps gold, bitcoin is the most successful currency in the world not associated with a central bank and state.
It's the most liquid asset that is not issued by a central bank. At any point you can issue a transaction to anyone else in the world, without the possibility of a third party intervention. I've had issues pulling cash out of banks, or limited sizes available for money orders, or having debt/credit card transactions incorrectly flagged as fraudulent and blocked.
- It can absolutely blocked by third parties (either the exchange you use or the mining cartels can).
- in practice its liquidity is tied to the liquidity of the ”stablecoins” (USDT and the likes) and as such it's not “the most liquid” since the liquidity of those stablecoins is higher.
The stablecoins you mention are arguably more liquid than Bitcoin, but, except for DAI, they're issued by central-bank-like institutions such as Binance and Coinbase. You're right that they're not officially central banks, but that just means you get all the drawbacks of central banks without the advantages.
The fact that the pools haven't intervene until now doesn't change the fact that they can definitely do it, and would if pressured by governments. Economic sanctions using the US dollar weren't a thing until they were.
And you only need to have leverage against 50% of the mining power to make that happen, which is pretty straightforward given how centralized the power structure of bitcoin is (although less centralized than for most crypto, for which the developer has full control).
I didn't sign anything, make any appointments, buy any insurance, walk into any offices, present any identification, or even tell the guy my name. The total time involved was about 20 minutes, but only because I wasn't using Lightning. I had a similarly informal and short, but more argumentative, experience with the previous transaction, at a winery whose owner loudly insisted that he hadn't received the money... until he realized he was checking the wrong phone.
You are so full of shit comparing this to a real estate transaction that I am at a loss for words. You're about as full of shit as the winery guy. He, too, was blathering all sorts of nonsense at me about Bitcoin that showed he didn't have the faintest idea what he was talking about.
The scenario you're talking about is a 51% attack where big mining pools collude to ensure that nobody else can ever mine a block (because it might allow the laundering of tainted coins). That would be a global and extremely obvious disaster for the Bitcoin network, and it would be remedied by whatever measures were necessary to end the attack, possibly including a hard fork or strategic bombing.
Remember that the world's investor class now has 2 trillion dollars tied up in Bitcoin, and they do not want to see it collapse, and such a successful attack would greatly undercut investor confidence in the value of the asset. The Bitcoin crowd has enough pull that they extracted a pardon for Ross Ulbricht and got a friendly SEC head this year. Even before that, when one or another pool would grow to the point where it might be able to mount a 51% attack, it would get hit by DDoS attacks to bring it down.
You're comparing that to a bank declining a credit card transaction because you're in another city.
Governments have been pressuring Bitcoin miners for over 15 years; it's outright illegal in many countries. The hashrate dropped by more than half when the PRC outlawed Bitcoin mining. The effect on the functioning of the network has been pretty much undetectable.
We are talking about the liquidity of an asset, $100 is change money.
Now try doing the same for $100k or $500k, without an exchange your options are very limited and the process is going to be very tedious (obviously you're not going to leave the guy to pee after moving a full bitcoin to their wallet without very strong guarantees that you will end up with the money in the end), and comparable to selling real estate. So of course it's not exactly equivalent to real estate because it's fungible and very small amount of bitcoin have some higher liquidity, it's still a very illiquid asset without an exchange compared to pretty much any other financial assets.
> The scenario you're talking about is a 51% attack where big mining pools collude to ensure that nobody else can ever mine a block
No, you just need to signal you'd mine on top of any block containing the transaction you want to block, and then no further block will ever be mined with the said transaction as other miner will follow suit. You just don't understand bitcoin except superficially and it shows.
> Governments have been pressuring Bitcoin miners for over 15 years; it's outright illegal in many countries
It doesn't matter if shithole countries with no leverage pretend to pressure bitcoin miners (yes it's all about pretending, as long as you don't see targeted assassinations in foreign country, you know the country doesn't really care). In the meantime, bitcoin and other crypto have been subsidized by governments in the Western world for years (through all the fiscal vehicles subsidizing start-up investment). You can be sure that the day a mining pool becomes the target of US sanctions (or has its staff abducted by some intelligence service) the landscape changes dramatically (it won't happen though, as they would cave without a fight).
> Remember that the world's investor class now has 2 trillion dollars tied up in Bitcoin
And they are absolutely uninterested in the ideological aspect of bitcoin, the ability for the US government to censor transactions is the least of their concerns.
It won't surprise you to learn that I haven't had the opportunity to sell US$100k of Bitcoin, but I expect it would be closely comparable to US$100k of US$100 bills, except that I can't zap those across to fixedfloat.com to change to a different cryptocoin or a friend on another continent in 30 seconds. Maybe it wouldn't be prudent to entrust all US$100k to fixedfloat.com in one transaction; maybe you'd want to use a series of smaller transactions of different sizes to reduce the counterparty risk.
But this doesn't seem like an issue of Bitcoin being particularly illiquid. Rather, it seems like exchanges make commodities more liquid, an assertion I don't think is controversial. But most other assets, such as real estate, shares, and even precious metals, are vastly less liquid than Bitcoin in the absence of an exchange. Finding someone on the street willing to buy Bitcoin is enormously easier than finding someone on the street willing to buy your MSFT shares.
I appreciate you explaining your speculations about 51% attacks in more detail. I think the course of action you're outlining would still be very likely to cause chain forks as big exchanges decided whether or not they were going to accept blocks from the compromised mining pools. The world's investor class many be absolutely uninterested in the ideological aspect of bitcoin, but they're very interested in mitigating political risks that threaten permanent loss of their capital.
I do not think your description of the People's Republic of China is a "shithole countr[y] with no leverage" or that it was "pretend[ing] to pressure bitcoin miners". The majority of Bitcoin mining was happening there, the majority of the world's coal was and is burned there, the vast majority of the world's solar panels are made there, the vast majority of the world's other electronics are manufactured there, and virtually all Bitcoin mining hardware is still designed there. But when they prohibited mining, most of the world's Bitcoin mining activity stopped within a few weeks.