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I Spent A Coin (And I Liked It) — How I Bought Lunch in Manhattan with Bitcoins

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Re: I Spent A Coin (And I Liked It) — How I Bought Lunch in Manhattan with Bitcoins

#21

Post by iwwr »

patrickg wrote: post #8
c4urself wrote: post #2

There's a lot to like about BitCoin. They "just" need to solve the following: 1. Technical issues (make it more secure) 2. Economic issues (deflation) 3. "Competitor" issues (governments, banks, the powerful status quo)

4) Legislative issues. For example Germany (I'd bet) would not accept bitcoins in one's tax form ("I have to pay 345.67 bit coins of taxes to the state"). And if you have income in a non approved currency, you get into some trouble.

The restaurant owner was basically exchanging BTC for USD on the spot and also reporting tax income in USD.

Re: I Spent A Coin (And I Liked It) — How I Bought Lunch in Manhattan with Bitcoins

#22

Post by dools »

ars wrote: post #10

The most important by far rule for currency is stability. With stability comes acceptance of the currency. You don't have that - the owner first looked up the exchange rate to US dollars. What you have is a medium of exchange, but you don't have a currency. A medium of exchange is useful, and can eventually become a currency. But bitcoins are not yet a currency. Perhaps someone can make a bank, where you store US dol…

Does that mean that the Euro is not a real currency? Or that the US dollar isn't real in Canada?

Re: I Spent A Coin (And I Liked It) — How I Bought Lunch in Manhattan with Bitcoins

#23

Post by beambot »

guelo wrote: post #18

If bitcoin was a currency the meal would have been denominated in bitcoins not dollars. Bitcoin is an asset like gold or a stock certificate, not a currency.

Following your logic, s/bitcoin/Euro/ would mean that the Euro is not a currency. That's just plain goofiness -- the USD is just the default currency at this establishment.

Re: I Spent A Coin (And I Liked It) — How I Bought Lunch in Manhattan with Bitcoins

#24

Post by [deleted] »

kbd wrote: post #13

Excellent article. My favorite quote: > Apart from whether there is a central bank somewhere to bid against George Soros, doesn’t the difference between a real currency and an imaginary currency lie in some sense in the composure with which a customer can ask if the currency is accepted here and in the composure with which a merchant can say yes? Every currency is valuable only because other people consider it to hav…

[deleted]

Re: I Spent A Coin (And I Liked It) — How I Bought Lunch in Manhattan with Bitcoins

#25

Post by ignifero »

Bitcoin is a commodity. Nobody issues it, it is mined and has a predictable, limited supply. People aspire to use bitcoin as fiat money, but that's impossible, there is no one to provide liquidity when the market runs out and there's no underlying economy it will be based upon. Commodities like gold, silver, petrol have been used or tied to money for centuries, but at some point their use was deprecated by the needs of the people. Adopting bitcoin as currency is like going back to the 19th century. It's an interesting idea for geeks, and maybe it will be used in special applications, but it's not an advancement for the economy, its a step back.

He might as well have paid with (numbered) paperclips if there was an MtGox for paperclips, does that mean that paperclips are the future?

Re: I Spent A Coin (And I Liked It) — How I Bought Lunch in Manhattan with Bitcoins

#26

Post by ignifero »

kd1220 wrote: post #14
ignifero wrote: post #6

Earlier quoted context omitted.

... Which will lead to 4. Trust. People can only agree to use a currency if they trust it.

I think the lack of physical tokens for Bitcoin (or any cryptocurrency) will likely be the main hurdle for public acceptance. It'll probably take another generation or two for people to get used to the idea of not having a physical representation for currency.

People accepted credit cards decades ago. If bitcoin could work as a currency (which it can't, for other reasons), it would presumably be used via equally convenient exchange devices.

Re: I Spent A Coin (And I Liked It) — How I Bought Lunch in Manhattan with Bitcoins

#27

Post by retube »

ars wrote: post #10

The most important by far rule for currency is stability. With stability comes acceptance of the currency. You don't have that - the owner first looked up the exchange rate to US dollars. What you have is a medium of exchange, but you don't have a currency. A medium of exchange is useful, and can eventually become a currency. But bitcoins are not yet a currency. Perhaps someone can make a bank, where you store US dol…

> You don't have that - the owner first looked up the exchange rate to US dollars

What? Any London store that accepts euros will check the rates daily to make sure they can convert back into the GBP price. Currency rates fluctuate all the time, every second of every day.

http://uk.finance.yahoo.com/q/bc?s=GBPEUR=X&t=1y&c=

Re: I Spent A Coin (And I Liked It) — How I Bought Lunch in Manhattan with Bitcoins

#28

Post by ars »

retube wrote: post #27
ars wrote: post #10

The most important by far rule for currency is stability. With stability comes acceptance of the currency. You don't have that - the owner first looked up the exchange rate to US dollars. What you have is a medium of exchange, but you don't have a currency. A medium of exchange is useful, and can eventually become a currency. But bitcoins are not yet a currency. Perhaps someone can make a bank, where you store US dol…

> You don't have that - the owner first looked up the exchange rate to US dollars What? Any London store that accepts euros will check the rates daily to make sure they can convert back into the GBP price. Currency rates fluctuate all the time, every second of every day. http://uk.finance.yahoo.com/q/bc?s=GBPEUR=X&t=1y&c=

Then they aren't accepting euros as currency. At the end of the day they will immediately convert the euros to GBP.

They are willing to use euros as a medium of exchange, but only because they know they can exchange them for (to them) real currency. (Currency is relative, obviously. And just as obviously it helps that somewhere in the world there are people who use that type of money, which gives you comfort that even if you don't exchange it now, you can later.)

If this was the fate of bitcoins then it would be a failure. People may use it to send value over the internet, but no one will keep their savings in bitcoins.

To be money you have to be willing to save it. If all you do is use it as an intermediate it's not money - yet. It may eventually become money (historically intermediates often do that - especially if the conversion is difficult), but it's not money yet.

The reason it's so important for people to store the currency in savings is very simple: If no one want to keep your money long term, practically speaking there will be very little of it in circulation, which makes it hard to use.

Re: I Spent A Coin (And I Liked It) — How I Bought Lunch in Manhattan with Bitcoins

#29

Post by niklas_a »

ars wrote: post #10

The most important by far rule for currency is stability. With stability comes acceptance of the currency. You don't have that - the owner first looked up the exchange rate to US dollars. What you have is a medium of exchange, but you don't have a currency. A medium of exchange is useful, and can eventually become a currency. But bitcoins are not yet a currency. Perhaps someone can make a bank, where you store US dol…

Don't know why this is getting upvoted as it contains a bunch of factual errors.

It's definitely being used as a currency already, as the article proves.

It's a highly fluctuating currency, but that doesn't remove it's properties as a currency.

Re: I Spent A Coin (And I Liked It) — How I Bought Lunch in Manhattan with Bitcoins

#30

Post by niklas_a »

ars wrote: post #28
retube wrote: post #27

Earlier quoted context omitted.

> You don't have that - the owner first looked up the exchange rate to US dollars What? Any London store that accepts euros will check the rates daily to make sure they can convert back into the GBP price. Currency rates fluctuate all the time, every second of every day. http://uk.finance.yahoo.com/q/bc?s=GBPEUR=X&t=1y&c=

Then they aren't accepting euros as currency. At the end of the day they will immediately convert the euros to GBP. They are willing to use euros as a medium of exchange, but only because they know they can exchange them for (to them) real currency. (Currency is relative, obviously. And just as obviously it helps that somewhere in the world there are people who use that type of money, which gives you comfort that eve…

Plenty of people save in BitCoin, some would even argue that's where much of it's value comes today. Look at the article from Richard Falkvinge that he linked to for an extreme example.

Nowhere did he suggest that the restaurant owner exchanged his BitCoins for USD. Maybe he saves them and uses them to buy something else. Who knows, maybe he buys the ingredients for his Meze using Bitcoins?

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