this post was submitted on 18 Jan 2025
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President-elect Trump launched his own cryptocurrency overnight and swiftly appeared to make more than $25 billion on paper for himself and his companies. 

Why it matters: The stunning launch of $TRUMP caught the entire industry off-guard, and speaks to both his personal influence and the ascendancy of cryptocurrency in his administration.

  • It also speaks to the nature of the crypto industry that someone could have $25 billion worth of something that literally did not exist 24 hours previously.
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[–] vrighter@discuss.tchncs.de -3 points 22 hours ago (1 children)

it's how crypto markets do. Since anonymity is a feature, any transactions will increase its value due to it being "used" more

[–] fuck_u_spez_in_particular@lemmy.world 4 points 22 hours ago (1 children)

No, because that would be an infinite money glitch, everyone would be rich... (that uses crypto).

It's actually very simple basic market-economics, and independently of anonymity, you buy, you'll drive the price up, you'll sell, you'll drive the price down. It's slightly more complicated, because it involves makers (they set the price at which to sell or buy) and takers (which take the offer by the maker) and psychology (e.g. promotion on youtube to drive the price up) and obviously increasingly algorithms. But in general it's still demand and supply, anonymity doesn't have anything to do here apart from being more prone to scams. Take Monero as example one of the most anonym cryptos but still fairly stable (in crypto terms).

So to drive the price up, you either have to have some kind of good promotion (which at the end is just money from someone else), or a lot of money yourself.

[–] vrighter@discuss.tchncs.de -2 points 22 hours ago (1 children)

the value of a cryptocurrency is based on its perceived value. Perceived value is based on market activity. If I keep sending money to myself it just shows up as market activity, with nobody being able to tell i sent money to myself.

gdp works this way too btw. I sell you $1 worth of stuff, you sell me $1 of stuff, nobody is any richer but gdp went up by $2. Except we can filter this kind of abuse out because it's not anonymous.

[–] fuck_u_spez_in_particular@lemmy.world 2 points 21 hours ago (1 children)

But GDP is not the price of an asset, it's a metric to measure the economic activity.

Is it really that hard to understand? The price is dictated by markets... Like with stock and other speculative assets. It's a little bit wilder, possibly due to anonymity and wild promotion on various platforms (like youtube) etc. But in it's essence it's still a market...

[–] vrighter@discuss.tchncs.de 1 points 20 hours ago* (last edited 20 hours ago) (1 children)

the price of an asset (when the asset is the currency itself) is based on its economic activity. You said so yourself. The price is dictated by markets. By how much is bought and sold on markets. That is the definition of economic activity. Which part of that do you not understand?

[–] fuck_u_spez_in_particular@lemmy.world 2 points 15 hours ago (1 children)

Well you brought GDP as argument, which just doesn't have anything to do with the price of an asset. If you sell a lot and buy a lot GDP grows, but the price of that asset can still be the same at the end.

Getting back to your initial argument:

Since anonymity is a feature, any transactions will increase its value due to it being “used” more

This is just plain wrong, as I could just make myself rich according to that logic... I still need to have that FIAT-money, need to exchange it (in which case I have driven the price up), but now I have less FIAT, so either I have more FIAT to further drive the price, or well I need to cash out in which case I'll drive the price down. If I just send crypto from one (anonymous) account to another it just does... nothing to the price...

[–] vrighter@discuss.tchncs.de 1 points 6 hours ago (1 children)

people don't use bitcoin to pay for other stuff. people buy and sell bitcoin itself. The currency is the asset.

people don't use bitcoin to pay for other stuff.

That isn't true, it is used albeit of course more for speculation, than FIAT.

The currency is the asset.

Guess what, FIAT money like the dollar and euro are also assets, and the same is true for that as well. Though Inflation is usually controlled by central banks.