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Online Cash Bitcoin could Challenge Governments, Banks

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Re: Online Cash Bitcoin could Challenge Governments, Banks

#141

Post by gaius »

mike_esspe wrote: post #139
joe_the_user wrote: post #131

Earlier quoted context omitted.

The problem is that since an alternative currency is still pretty purely hypothetical, we don't know with any certainty that it wouldn't be subject to similar abuses. Moreover, aside from inflation, the other abuses you list are essentially abuses of power and if governments maintain power - their official monopoly of force and violence, they will continue to be able to engage in these other actions. EI, I don't thin…

If I'm not mistaken, at least in US you can't be forced to reveal your password?

Then they do you for "contempt of court" rather than whatever they charged you with originally, surprise surprise the sentence is the same.

Re: Online Cash Bitcoin could Challenge Governments, Banks

#142

Post by OstiaAntica »

seanalltogether wrote: post #94
tcoppi wrote: post #87

Earlier quoted context omitted.

There is a finite amount of bitcoins because it is designed to mimic a natural resource - easy to "mine" at first, much more difficult to mine as time goes on, and eventually there are none left. If there were an infinite amount of bitcoins that could be generated, there would always be inflation in place roughly proportional to the amount of computational power being used to mine, and soon your bitcoins would be wor…

You know I've thought about this for awhile and I'm starting to come to the conclusion that inflation is a good thing. Having a currency that doesn't inflate is bad for 2 reasons. 1. The population keeps growing, 2. Humans are hoarders. Having currency inflate encourages society to use their money instead of squirreling it all away. Everything in life devalues over time and I don't think currency should be any differ…

No one squirrels away money-- savings in a bank is still reinvested into the economy, by the bank through lending. Unless you are literally sticking money under a mattress, it gets circulated.

Re: Online Cash Bitcoin could Challenge Governments, Banks

#143

Post by mike_esspe »

ZitchDog wrote: post #122
tcoppi wrote: post #108

Earlier quoted context omitted.

Most of these arguments apply if you are going to be using a finite supply of money as your "main" currency. I agree that not having an inflatable supply is bad in such situations. However it is incredibly unlikely that bitcoin will ever occupy this niche(I highly doubt anyone is going to ever pay taxes in BTC). For what it is, an easy and quick way to transact payments anonymously* and securely online, it is incredi…

It will still be bad for the adoption of Bitcoin as a trading currency. If I have a Bitcoin that is worth $1 today but will almost certainly be worth more than that in a month, what is my incentive to give you the Bitcoin? Wouldn't it be smarter for me to just give you $1 directly via PayPal? As it stands the only reason to use Bitcoin currently is for shady deals, novelty, and speculation. I find it laughable that B…

You should get $1 somehow (exchange BTC to dollars for example), so it's equivalent to sending the exchanged amount of BTC.

Re: Online Cash Bitcoin could Challenge Governments, Banks

#144

Post by mike_esspe »

quanticle wrote: post #120
vrotaru wrote: post #91

Earlier quoted context omitted.

> There has never had been such a thing a deflationary spiral , though.

Yes there has. The Great Depression was a deflationary spiral. Bank failures caused people to hoard currency. This hoarding led to decreased investment and economic activity. The decrease in economic activity led people to lose jobs, which caused them to hoard even more money. In addition, the decrease in the money supply greatly increased the value of debts. You were getting paid less, but the your mortgage payment…

Great Depression was in the epoch of fiat money and most likely was a result of inflating money supply during 1920s (http://en.wikipedia.org/wiki/Causes_of_the_Great_Depression#...).

Do you know about a deflationary spiral when gold was the money? (Almost all the history before 20th century).

Re: Online Cash Bitcoin could Challenge Governments, Banks

#145

Post by Groxx »

ZitchDog wrote: post #122
tcoppi wrote: post #108

Earlier quoted context omitted.

Most of these arguments apply if you are going to be using a finite supply of money as your "main" currency. I agree that not having an inflatable supply is bad in such situations. However it is incredibly unlikely that bitcoin will ever occupy this niche(I highly doubt anyone is going to ever pay taxes in BTC). For what it is, an easy and quick way to transact payments anonymously* and securely online, it is incredi…

It will still be bad for the adoption of Bitcoin as a trading currency. If I have a Bitcoin that is worth $1 today but will almost certainly be worth more than that in a month, what is my incentive to give you the Bitcoin? Wouldn't it be smarter for me to just give you $1 directly via PayPal? As it stands the only reason to use Bitcoin currently is for shady deals, novelty, and speculation. I find it laughable that B…

>Wouldn't it be smarter for me to just give you $1 directly via PayPal?

Which you would get by... selling some amount of bitcoins to an exchanger. And the person you give $1 to would turn around and buy the same amount from another exchanger, less overall fees both ways.

It amounts to the same thing, unless you view bitcoins as a dead-end worthless location to put money in, because you never use them. Which is irrational - it's pure loss for you if you never use them.

Re: Online Cash Bitcoin could Challenge Governments, Banks

#146

Post by Groxx »

seanalltogether wrote: post #94
tcoppi wrote: post #87

Earlier quoted context omitted.

There is a finite amount of bitcoins because it is designed to mimic a natural resource - easy to "mine" at first, much more difficult to mine as time goes on, and eventually there are none left. If there were an infinite amount of bitcoins that could be generated, there would always be inflation in place roughly proportional to the amount of computational power being used to mine, and soon your bitcoins would be wor…

You know I've thought about this for awhile and I'm starting to come to the conclusion that inflation is a good thing. Having a currency that doesn't inflate is bad for 2 reasons. 1. The population keeps growing, 2. Humans are hoarders. Having currency inflate encourages society to use their money instead of squirreling it all away. Everything in life devalues over time and I don't think currency should be any differ…

Humans are hoarders, but humans like stuff too. If they hoard everything, they're either conceptually sticking it under their mattress, or they're loaning it out to make more, which is putting it back in the market. If they like stuff, they'll eventually buy something with what they've been hoarding.

I know that's the core argument against deflationary currency, but I don't see how it's valid. I find it much more likely that it's a belief pushed on our society by money lenders, as they thrive on people buying things now that they can't afford at the moment. Not implying a conspiracy - that implies organization, which isn't necessary for such an emphasis. It's in the lenders' best interest, so they'll do so.

Re: Online Cash Bitcoin could Challenge Governments, Banks

#147

Post by mike_esspe »

tnt128 wrote: post #93
pyre wrote: post #76

Earlier quoted context omitted.

And that worked so well for copyright piracy! I'm glad we live in a world without pirated music and movies!

If the government can confiscate gold, what would prevent them from passing the law saying bitcoin ownership is illegal?

I hope, that US can't return in time of "executive order 6102"

Re: Online Cash Bitcoin could Challenge Governments, Banks

#148

Post by Groxx »

weavejester wrote: post #5
gaius wrote: post #3

This is what happens when you challenge governments and banks: http://news.ycombinator.com/item?id=2451302

There are lots of examples of governments or large organisations taking down networks with single points of failure, but far fewer examples of taking down highly distributed networks like Bitcoin. I don't think this fight is a foregone conclusion. I think it would be difficult to write a law that would make Bitcoin illegal, without making things like MMO currencies or SSL certificates illegal.

>far fewer examples of taking down highly distributed networks like Bitcoin.

There are plenty of examples of the reverse, however. Bittorrent continues to thrive.

Re: Online Cash Bitcoin could Challenge Governments, Banks

#149

Post by A1kmm »

ender7 wrote: post #103

Bitcoin is both a really great idea, and a really stupid idea. sage_joch has already pointed out the reasons why it's a really cool idea. It's also flawed in a number of ways. First, the limited supply means that you've essentially just created an electronic version of gold. It's more easily tradeable, but its behavior as a commodity will be similar. If you like investing in gold, that's great. I guess. Second, bitco…

In response to your second point, if there is a good BitCoin economy, a business might be able to earn BitCoins, and spend some of those BitCoins on costs to buy services from other BitCoin acceptors, and maybe even issue dividends in BitCoins. Shareholders could use those BitCoins to buy things directly.

These transactions require computational resources to get them into the block chain, so probably would cost money, but with low barriers of entry, they would tend towards the computational cost of getting a block into the chain.

However, unlike with a credit card, there is no requirement that amounts get converted back into a government-backed currency after every transaction.

Re: Online Cash Bitcoin could Challenge Governments, Banks

#150

Post by weavejester »

quanticle wrote: post #118
weavejester wrote: post #96

Earlier quoted context omitted.

No there isn't. Anonymous paper money is still used in every country in the world, anonymising P2P networks like Tor and I2P have not been outlawed, you can buy pre-paid VISAs and pre-paid phones legally and anonymously and many people send routinely anonymous donations to political organisations.

you can buy pre-paid VISAs and pre-paid phones legally and anonymously I thought legislation had been passed stating that purveyors of pre-paid debit cards and cell phones had to ask for ID and keep records so that, if the cards or phones were used in a crime, the purchaser could be traced. I do know that legislation to that effect was introduced. I'm not sure if it was ratified, but even if anonymous cards and phone…

I don't believe it was. At least, when I was in the states a few weeks back, I wasn't asked for ID when I bought a cheap pre-paid cell phone.

There is a tendency to be pessimistic about the place of anonymity in the future, but I prefer to look on the bright side. The US government doesn't win every fight it enters, and there is a long-term trend toward more freedom and openness, rather than the opposite way around.

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