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Bitcoin, a service and the micro-micro-economy

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Re: Bitcoin, a service and the micro-micro-economy

#41

Post by yummyfajitas »

trotsky wrote: post #28

People who grow interested in participating in the bitcoin market because of this or other articles about the currency should be aware that at its heart it is a very speculative market. The price of a bitcoin in USD has risen dramatically through most of its life while lacking economic fundamentals for why it should. Indeed, the money supply in the bitcoin market increases steadily over time, this should be inflation…

Of course, it is in the rational best interests of anyone who holds bitcoin to disagree with this assessment.

No, it is in the rational best interests of anyone holding bitcoins to have the most accurate assessment possible of their future value.

If that assessment suggests the future value will go down, it is in their rational best interests to sell bitcoins.

Re: Bitcoin, a service and the micro-micro-economy

#42

Post by dublinclontarf »

ashconnor wrote: post #31
noagendamarket wrote: post #27

Earlier quoted context omitted.

If you leave your wallet on the beach your cash is gone or someone could pickpocket you. Egold was located on a central server that was liable to confiscation. You can buy alpaca socks with bitcoin. You can do money laundering ,cp and drugs with US dollars.

You have recourse by contacting authorities. E-gold's centralised system was not what I was debating. It was the exchange of e-gold to fiat currencies. Alpaca socks I will assume are created by the person who actual sells them. Dealing with other suppliers who won't accept BitCoin was the obstacle I was detailing. I don't debate that you can launder money in USD but it is easier in this system. There's no paper trail…

>You have recourse by contacting authorities.

I'm sorry I would have replied to your comment earlier but I was incapacitated with laughter.

How often have the "authorities" been able to help a person recover a stolen wallet? Or the funds taken from their bank account with a skimmed ATM card? Or any of the thousands of other kinds of fraud and theft or robbery?

The "authorities" file reports, thats about it. What they do provide is the illusion of protection, a false sense of security.

Really what are they the "authorities" going to do that a normal person can't?

Re: Bitcoin, a service and the micro-micro-economy

#43

Post by kiba »

trotsky wrote: post #38
kiba wrote: post #32

Earlier quoted context omitted.

"More goods and services" is practically the catchphrase of the community. We are well aware of this fact. How can I help bitcoin out? Sell something on the market!

To be clear, I don't have a fundamental issue with the concept of bitcoin or the technical implementation. I just see a lot of people who grow interested in obtaining it without knowing what they'll do with except for selling it to someone else. If people want to trade their USD/EUR/GBP/JPY for it as is often suggested by the bitcoin community, or decide that they want to consume electricity in order to obtain it wel…

It is still difficult to acquire bitcoin for the foreseeable future, so more exchanges will become online to make it easier. There's source code for open source exchanges floating around, so the barrier of entry is getting lower and lower over time.

On the other hand, we have to be patient about goods and services coming online. The community grown a lot in the past few months but it takes a while for people to develop their goods and services and find their niche within the economy. The economy is small, so it's harder to make money as well.

For example, I am just starting to gain back my investment on a niche magazine I made for bitcoin. After the website development is finished, I will be moving on to an ambitious video game project.

Just to be clear, the bitcoin economy is very tiny. It's only about 4.4 million USD economy at best and the real value is probably much smaller.

Re: Bitcoin, a service and the micro-micro-economy

#44

Post by dublinclontarf »

jrmg wrote: post #40
dublinclontarf wrote: post #9

Allow me to extol the virtues of bitcoin over the current credit-card/banking based payment system. 1)Hard money, once you receive payment in bitcoin it stays with you, meaning no chargebacks(Paypal, credit cards, looking at you). 2)Fast payment, you can recieve payment within minutes of it being made(sometimes faster, but more on this in a moment). 3) Low barriers of entry, to start accepting bitcoin you don't need…

4) No red tape, this is slightly related to the above but important enough to warrant it's own point. With bitcoin there are no forms, no regulations, no paperwork. You can send bitcoin to anyone, anywhere, anytime, any amount and no one will care or track you, or freeze your account or any of the other issues when dealing with the current banking system. I'm sure your tax authorities would have something to say abou…

Yeah, good luck attributing those transactions to me, or to anyone else for that matter.

Sure if you're an already existing company it's a good idea to keep accurate records, file forms etc. but if your some 15 year old kid with a great idea who cares, go for it!

With the arrival of new businesses operating entirely from within the bitcoin economy and cypherspace no amount of government regulation will matter. How can you tax something you can't even find, or stop or do anything to?

Re: Bitcoin, a service and the micro-micro-economy

#45

Post by trotsky »

dublinclontarf wrote: post #29
PostOnce wrote: post #26

Earlier quoted context omitted.

You know what else is great about it? The money is stored as a file on your computer. I can steal it from my laptop from the park across the street from your house and be gone before you know its missing, and you will never, ever be able to find me. All I have to do is steal your wallet file and transfer the bitcoins to my account, and the money is irreversibly mine. Computer security being what it is, and with bitco…

How will you do that? I don't even have wireless. Jokes aside, the current financial system has the exact same problems, and infact can be worse, especially with username:password based authentication. If someone skims your ATM card and gets your pin number too bad, you've lost the money. Or you could have your wallet pickpocketed, and the thief would be gone without you even knowing the money was missing. What about…

While the current financial system does suffer from many of the same problems, the difference is that there is a sophisticated infrastructure that exists to combat this behavior in these cases. Law enforcement, security services, intelligence agencies, government regulators, bank and credit card employees and insurance companies, among others, all work every day to mitigate these risks on behalf of their respective systems.

Re: Bitcoin, a service and the micro-micro-economy

#46

Post by jrmg »

dublinclontarf wrote: post #44
jrmg wrote: post #40

Earlier quoted context omitted.

4) No red tape, this is slightly related to the above but important enough to warrant it's own point. With bitcoin there are no forms, no regulations, no paperwork. You can send bitcoin to anyone, anywhere, anytime, any amount and no one will care or track you, or freeze your account or any of the other issues when dealing with the current banking system. I'm sure your tax authorities would have something to say abou…

Yeah, good luck attributing those transactions to me, or to anyone else for that matter. Sure if you're an already existing company it's a good idea to keep accurate records, file forms etc. but if your some 15 year old kid with a great idea who cares, go for it! With the arrival of new businesses operating entirely from within the bitcoin economy and cypherspace no amount of government regulation will matter. How ca…

I guess our political views differ. I find the idea of cheating on taxes rather distasteful.

In any case, morals aside, I don't really see why this is different to cash for taxation purposes. Cash is also basically untraceable, and while there are certainly plenty of under-the-table transactions that mean it's not taxed 100% accurately, it's pretty hard to get away with avoiding taxes indefinitely if you're handling a lot of it. I don't understand why bitcoin would be any different.

Re: Bitcoin, a service and the micro-micro-economy

#47

Post by trotsky »

yummyfajitas wrote: post #41
trotsky wrote: post #28

People who grow interested in participating in the bitcoin market because of this or other articles about the currency should be aware that at its heart it is a very speculative market. The price of a bitcoin in USD has risen dramatically through most of its life while lacking economic fundamentals for why it should. Indeed, the money supply in the bitcoin market increases steadily over time, this should be inflation…

Of course, it is in the rational best interests of anyone who holds bitcoin to disagree with this assessment. No, it is in the rational best interests of anyone holding bitcoins to have the most accurate assessment possible of their future value. If that assessment suggests the future value will go down, it is in their rational best interests to sell bitcoins.

Good point. I didn't mean to say it is in the rational best interests of anyone holding bitcoins to not understand the market forces involved. You make a good argument that it is in their interests to understand what they hold. However, if you buy my argument that the BTC market is nearly wholly speculative at this point, it is probably not in the interests of speculators holding BTC to have it publicly understood as this would seem to lead to an evaporation of upward pressure on the market.

Re: Bitcoin, a service and the micro-micro-economy

#48

Post by dublinclontarf »

trotsky wrote: post #45
dublinclontarf wrote: post #29

Earlier quoted context omitted.

How will you do that? I don't even have wireless. Jokes aside, the current financial system has the exact same problems, and infact can be worse, especially with username:password based authentication. If someone skims your ATM card and gets your pin number too bad, you've lost the money. Or you could have your wallet pickpocketed, and the thief would be gone without you even knowing the money was missing. What about…

While the current financial system does suffer from many of the same problems, the difference is that there is a sophisticated infrastructure that exists to combat this behavior in these cases. Law enforcement, security services, intelligence agencies, government regulators, bank and credit card employees and insurance companies, among others, all work every day to mitigate these risks on behalf of their respective s…

And you don't think anyone in the bitcoin world is working on the same thing?

>the difference is that their a sophisticated infrastructure that exists to combat....

Infrastructure becomes moot when it's too "sophisticated" for granny(or me,I mean really, how often haveI lost my online banking key fob? or I have to enter an endless string of numbers just to see my balance?) to use.

And besides, we have the "sophisticated" infrastructure of cryptography on our side. The only real way around this is with social engineering, to which the current financial system is equally vulnerable.

With regards to the "authorities" you list see here http://news.ycombinator.com/item?id=2387022, I find it hard to imagine that the CIA is worried or working on the problem of Nigerians or Russians trying to scam people, or helping people who are victims.

Re: Bitcoin, a service and the micro-micro-economy

#49

Post by PostOnce »

dublinclontarf wrote: post #29
PostOnce wrote: post #26

Earlier quoted context omitted.

You know what else is great about it? The money is stored as a file on your computer. I can steal it from my laptop from the park across the street from your house and be gone before you know its missing, and you will never, ever be able to find me. All I have to do is steal your wallet file and transfer the bitcoins to my account, and the money is irreversibly mine. Computer security being what it is, and with bitco…

How will you do that? I don't even have wireless. Jokes aside, the current financial system has the exact same problems, and infact can be worse, especially with username:password based authentication. If someone skims your ATM card and gets your pin number too bad, you've lost the money. Or you could have your wallet pickpocketed, and the thief would be gone without you even knowing the money was missing. What about…

Bitcoin banks negate true anonymity, the govt can contact the bank and ask for acct details, so they are worse than regular banks, being uninsured, unregulated, and unsecured. Also, real banks have men with guns (not to mention the capability to summon heavily-armed police officers on very short notice) to protect them. Neither your computer nor your bitcoin bank is 1] stored in a vault or 2] protected by armed guards.

With that said, if you want anonymity, you don't use a bitcoin bank. Which means you store ALL your money on your computer, probably. Who carries ALL their money in their wallet? No-one.

ATM cards have various protections built into them, pin number, fraud protection, withdrawal limit, the fact that people keep them on their person and know to protect them, etc.

You can't steal an ATM card from 200 feet away without someone knowing about it.

It's also relatively hard to pickpocket people. You have to be right next to them.

The first bitcoin-stealing virus is going to be downright hilarious. (What's your physical analogy there? Someone could build a network of tiny robots and have them covertly steal cash from banks? It's theoretically possible.)

Re: Bitcoin, a service and the micro-micro-economy

#50

Post by dublinclontarf »

jrmg wrote: post #46
dublinclontarf wrote: post #44

Earlier quoted context omitted.

Yeah, good luck attributing those transactions to me, or to anyone else for that matter. Sure if you're an already existing company it's a good idea to keep accurate records, file forms etc. but if your some 15 year old kid with a great idea who cares, go for it! With the arrival of new businesses operating entirely from within the bitcoin economy and cypherspace no amount of government regulation will matter. How ca…

I guess our political views differ. I find the idea of cheating on taxes rather distasteful. In any case, morals aside, I don't really see why this is different to cash for taxation purposes. Cash is also basically untraceable, and while there are certainly plenty of under-the-table transactions that mean it's not taxed 100% accurately, it's pretty hard to get away with avoiding taxes indefinitely if you're handling…

Exactly just like cash, people like cash.

However you could sell a lot of online services with bitcoins, potentially millions of USD worth without the taxman getting so much as a sniff that anything odd is happening. Nor even if they investigated you would they be able to prove anything(depending on your lifestyle,no pricy sports cars).

With regards to my political views, I'm not a fan of paying governments to screw me. I tend to like the idea of keeping the wealth I created. But more importantly I like being able to make that wealth with methods that the government might not approve of.

And bitcoin can allow me to do that.

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