81–90 of 221 posts
Earlier quoted context omitted.
If you do that, what's the advantage of bitcoin?
You can send bitcoins directly to a person's account without going through an intermediary, such as Paypal or a bank. This means that it would potentially be cheaper, but more importantly it would be easier to automate, and easier to start up interesting financial web apps.
> Because Bitcoin is an open-source project, and because the database exists only in the distributed peer-to-peer network created by its users, there is no Bitcoin company to raid, subpoena or shut down. Which will leave only Bitcoin users to raid, subpoena and shut down.
Actually, they would probably only need to raid a substantial amount (maybe half?) in order to control the block chain.
Why is Bitcoin a good currency again? If I understand how it is distributed correctly, those with higher/more computational power receive more of the finite bitcoins. How does that not favor the already rich?
> Because Bitcoin is an open-source project, and because the database exists only in the distributed peer-to-peer network created by its users, there is no Bitcoin company to raid, subpoena or shut down. Which will leave only Bitcoin users to raid, subpoena and shut down.
I'd like to see them raid every single Bitcoin user worldwide, which is how I think it would have to happen in order to shut it down. Actually, they would probably only need to raid a substantial amount (maybe half?) in order to control the block chain.
Earlier quoted context omitted.
Hrm. My understanding is that inflation can affect anything we attach value to (and that broadly speaking "value" is also an abstract concept). Suppose the price of oil (or any other primary resource) jumps 50%, increasing the nominal cost of everything that has been made from it. Your gold backed dollar now can be exchanged for less things than before, irrespective of the total supply of gold in the world. Does that…
That's not inflation, though, that's just a price change...
My dollar is worth less (can be exchanged for less goods) than it was before - I'm pretty sure that's inflation.
Bitcoin is a fantastic idea, with one crucial mistake: the finite nature of bitcoins. The fact that coins will one day "run out" will almost certainly lead to increased speculation, which will in turn lead to a deflationary spiral, followed by a "bubble burst" when speculators sell all their bitcoins and average coin holders are left holding the bag. Infinite coins would tie the value to the opportunity cost of compu…
Without speculation it's a product/service no one wants (because it has no value or potential), by definition.
Before today Bitcoin was "just" interesting to me, after reading this I now see the potential it has.
I think I'm going to run an experiment and also accept payment for my product in Bitcoins: http://www.devside.net/server/webdeveloper
Bitcoin is a fantastic idea, with one crucial mistake: the finite nature of bitcoins. The fact that coins will one day "run out" will almost certainly lead to increased speculation, which will in turn lead to a deflationary spiral, followed by a "bubble burst" when speculators sell all their bitcoins and average coin holders are left holding the bag. Infinite coins would tie the value to the opportunity cost of compu…
As well, bitcoins are divisible to 8 decimal places, so I don't think there's any problem of "running out" in practice, bitcoins will just become more and more valuable. And why shouldn't they? Miners and investors now are expending time and money investing in them, which is a risk because bitcoin may never become popular. The greater the risk, the greater the reward, same in any type of business.
Earlier quoted context omitted.
>Why is Bitcoin a good currency again? It isn't, but almost anything can work if the community of users is small enough. As for why it isn't, we need to step back a bit. In a barter economy an exchange occurs when two individuals each produce something which takes time/labor/capital and which the other person values more than what they're giving up. For example, if I grow an apple, and you grow an orange, and we trad…
Is a $20 bill something of value? No, it's merely somewhat hard to forge, and accepted as currency by lots of people. Or how about an entry in a ledger on some bank's computer? The only reasons the $20 bill or the entry in the computer retain value are because there's a central entity that limits the creation of too many of them, and people accept it as currency in exchange for good, because they expect that other pe…
I think perhaps you and I are using different definitions of "value". If someone is willing to accept something in exchange for something else, that act reveals that they value it, either for its use value or for its exchange value (i.e., as money).
>The only reasons the $20 bill or the entry in the computer retain value are because there's a central entity that limits the creation of too many of them
Why do you think that? It's certainly true that artificial scarcity raises prices (for money, in terms of all other goods), but that scarcity is not what is being subjectively valued.
A $20 bill today is valued (as money) based on what it could buy yesterday. And yesterday's valuation (as money) was based on the day before that. Go back far enough and the money valuation will have spawned from the commodity valuation.
Bitcoin is flawed in largely the same ways that fiat currencies are flawed, namely that the commodity has no use value demand, and the supply is not subject to market forces.
The difference with fiat currencies is that they have quite a few things going for them that keep them around: taxes are demanded in them, a raft of laws eliminate competition, and a central bureaucracy actively manipulates the market.
Bitcoin is a fantastic idea, with one crucial mistake: the finite nature of bitcoins. The fact that coins will one day "run out" will almost certainly lead to increased speculation, which will in turn lead to a deflationary spiral, followed by a "bubble burst" when speculators sell all their bitcoins and average coin holders are left holding the bag. Infinite coins would tie the value to the opportunity cost of compu…
Speculation is exactly what is required for Bitcoin to take hold as a legitimate currency. Without speculation it's a product/service no one wants (because it has no value or potential), by definition. Before today Bitcoin was "just" interesting to me, after reading this I now see the potential it has. I think I'm going to run an experiment and also accept payment for my product in Bitcoins: http://www.devside.net/se…