Bitcoin exchange rate reached $100 USD per BTC • Hacker News Board

Re: Bitcoin exchange rate reached $100 USD per BTC

#551

Post by weavejester » Tue, Apr 02, 2013, 1:57 PM UTC

betterunix wrote: post #100

GhotiFish wrote: post #83

Earlier quoted context omitted.

That may be true, but I'd wager most of the people who are buying into bitcoin for its property as a store of value will be shocked to find out bitcoins other very interesting property. The ease and low cost of transferring those bitcoins to anyone, anywhere in the world. "I can BUY things with these? Wait... I can sell things? I just need to paste a hash?!"

Then one day, some highly motivated attacker will come along and discover the other very interesting property: that the work needed to attack Bitcoin scales linearly with the work needed to use Bitcoin. As soon as a successful attack is announced publicly, faith in Bitcoin will be shaken to badly that nobody will ever want to use anything called "digital cash" for a long time. So the real question you should be askin…

> As soon as a successful attack is announced publicly, faith in Bitcoin will be shaken to badly that nobody will ever want to use anything called "digital cash" for a long time.

It's worth noting that a 51% attack would only allow double-spending, and it's not something that could be realistically hidden; it would be very obvious what was happening. In addition, the amount of computing power available to the bitcoin network is becoming significant enough that it would be hard to exceed, even with a botnet.

It's also worth pointing out that people still use Paypal, despite all the stories of frozen accounts and people never getting their money back. People also still use credit cards, despite not every instance of fraud resulting in the victims getting their money back.

Re: Bitcoin exchange rate reached $100 USD per BTC

#552

Post by drivebyacct2 » Tue, Apr 02, 2013, 2:01 PM UTC

jaibot wrote: post #508

drivebyacct2 wrote: post #174

Earlier quoted context omitted.

Good luck. I hope it goes better for you than the people planning to do it 3 weeks ago. Or 3 months ago. Or a year ago.

Sell high, buy low.

Right. Like it was higher 3 weeks ago. Or 3 months ago, or a year ago?

Re: Bitcoin exchange rate reached $100 USD per BTC

#553

Post by etherael » Tue, Apr 02, 2013, 2:12 PM UTC

brycedriesenga wrote: post #545

etherael wrote: post #514

Earlier quoted context omitted.

Yeah, apple is obviously so much more valuable than bitcoin because having computers in prettier cases or phones with prettier user interfaces is incalculably more valuable than access to a provably fair and reliable financial system not captive to the global banking cartels or their crony governments. This place is really starting to depress me.

I'd argue there's a difference between "prettier" and "more thoughtfully designed."

Ok, Even if this is granted, more thoughtfully designed products that exist within an already existing category and enable no entirely new abilities. A globally distributed peer to peer cryptocurrency with the characteristics bitcoin has, whether this actually is bitcoin or some other item that has the same characteristics, is an enormous game changer.

I was just reading a comment from someone who I think really nailed just how big this could potentially be, so instead of restating it I'll just link to it;

http://www.reddit.com/r/Bitcoin/comments/1bhhjg/any_bitcoin_...

Re: Bitcoin exchange rate reached $100 USD per BTC

#554

Post by roguas » Tue, Apr 02, 2013, 2:18 PM UTC

Bitcoins were designed to do that. If the price for 1 BTC rises to the level it becomes profitable to offer them computing power for the network people will generate new money. Until then its value gonna rise. This will loop until infinity.

Its hard to compare against dollar. As bitcoin is newborn with freedom written all over it. If it gets adapted more chances are its gonna be rising in value and will become first a currency for savings later on a day to day activity currency.

Re: Bitcoin exchange rate reached $100 USD per BTC

#555

Post by dragontamer » Tue, Apr 02, 2013, 2:27 PM UTC

cmccabe wrote: post #518

dragontamer wrote: post #515

Earlier quoted context omitted.

"What is certainly true is that Gold is a very good long-term store of value, and the prices of Gold relative to other things, such as a loaf of bread, a barrel of oil, a parcel of land are quite stable over a long period of time." Wanna take a bet on that? http://www.macrotrends.org/1340/gold-vs-the-cpi-historical-c... Gold is out there, sometimes swinging by 1,700% over a decade... while the CPI doesn't change any…

Pretty much every big economy is trying to inflate away its debts. The Bank of England recently revised their inflation target upwards. Now Japan's central bank is talking about doing the same thing. As far as the US goes: I've got two words for you: quantitative easing. Meanwhile, most consumer price indices don't include the things which increase in price the most, like fuel and food. So the inflation numbers you'r…

Get your facts straight. Have you ever read a CPI report? Do you even know how the CPI is calculated? Here's the list of CPI weights.

ftp://ftp.bls.gov/pub/special.requests/cpi/cpiri2010.txt

Food: 14.792% Housing: 41.460% Fuel: 5.079% Energy (included inside of "housing category"): 5.096%

If you're curious, you can further subdivide that into milk and eggs. But the list becomes way too unwieldy at that point. The averages are then computed using a geometric mean.

Also, Bond bankers are willing to accept a loss on TIPS, because a fair number of them are betting the opposite of inflation: the potential of deflation between 2008 and 2012.

http://www.nber.org/papers/w14701 http://www.frbatlanta.org/research/inflationproject/dp/

When big banks were buying up US Treasuries constantly because they're worried about deflation... to the point where some bonds are offering a negative return... the switch of Monetary Policy that favors inflation is the obvious move. Notice: Gold Dropped in value since last year, while big investors continue to run towards the safety of US Treasuries... pushing yields to absolute lows. Why? Because during 2012, the major banks and investors were worried about deflation risk.

Buying commodities and gold when there is considerable deflation risk is dumb.

Re: Bitcoin exchange rate reached $100 USD per BTC

#556

Post by cjg » Tue, Apr 02, 2013, 2:33 PM UTC

balakk wrote: post #80

What would it take for somebody like Amazon or eBay to (even partially) support bitcoins? How much of a risk could it be?

I imagine this will happen via Payment Service Providers first. Merchants that don't want to manage their own payment code outsource it to some third party company.

Those PSPs compete and one dimension they compete on is breadth of payment methods. Who wants to be the only one who doesn't offer BTC?

Once PSPs have integrated bitcoins, many merchants will accept them.

Re: Bitcoin exchange rate reached $100 USD per BTC

#557

Post by cjg » Tue, Apr 02, 2013, 2:42 PM UTC

al1x wrote: post #442

sturmeh wrote: post #437

Earlier quoted context omitted.

LTC has seen 200% growth over the last week, people are adopting it hoping it will be an equal competitor. Other people are adopting it just in-case they're right.

This seems a natural consequence of bitcoin's adoption and growth. I see virtually no barriers to entry here, no limit to the number of competing currencies that could be introduced, and as a result no real value to bitcoins. How long can one cryptocurrency expect to be allowed to grow before another comes along and dilutes the market? What factors prevent the average consumer from considering them substitutes? Bitco…

The barrier to entry is in gaining the adoption.

Re: Bitcoin exchange rate reached $100 USD per BTC

#558

Post by NkVczPkybiXICG » Tue, Apr 02, 2013, 3:17 PM UTC

JumpCrisscross wrote: post #543

lenazegher wrote: post #529

Earlier quoted context omitted.

With an inflationary currency, you can pay your workers nominally slightly more each year while paying them the same amount or even slightly less in real terms. With a deflationary currency, you can pay your workers nominally slightly less each year while paying them the same or even slightly more in real terms. How would the average person on the street react to being told "You've performed really well this year, so…

That would seem to be the case à la Fisher. But the evidence from Japan, a slowly, albeit steadily, deflating advanced economy is compelling. From January 1995 to January 2010, Japan's CPI (2005=100) has fallen from 100.8797 to 99.5851, or or -0.08% per year. In that time, real wages grew 0.23% [1]. Real GDP/capita at 0.61%. Hell, from 2010 to 2013 their CPI has fallen at 0.27% annually, but the hit has been mixed. N…

Bitcoin isn't that deflationary, and won't be at all until 2140.

When 2140 comes around, and all the bitcoin is mined, then it will only deflate at the rate which coin is "lost into the ether" from people losing their wallets, etc. I highly doubt the deflation rate will be anywhere near 1%.

Re: Bitcoin exchange rate reached $100 USD per BTC

#559

Post by betterunix » Tue, Apr 02, 2013, 3:20 PM UTC

weavejester wrote: post #551

betterunix wrote: post #100

Earlier quoted context omitted.

Then one day, some highly motivated attacker will come along and discover the other very interesting property: that the work needed to attack Bitcoin scales linearly with the work needed to use Bitcoin. As soon as a successful attack is announced publicly, faith in Bitcoin will be shaken to badly that nobody will ever want to use anything called "digital cash" for a long time. So the real question you should be askin…

> As soon as a successful attack is announced publicly, faith in Bitcoin will be shaken to badly that nobody will ever want to use anything called "digital cash" for a long time. It's worth noting that a 51% attack would only allow double-spending, and it's not something that could be realistically hidden; it would be very obvious what was happening. In addition, the amount of computing power available to the bitcoin…

"In addition, the amount of computing power available to the bitcoin network is becoming significant enough that it would be hard to exceed, even with a botnet."

https://en.wikipedia.org/wiki/TICOM

I agree that people may very well use Bitcoin despite a successful attack (plenty of people still use Hushmail), although I think a lot of confidence would be lost. Bitcoin has a lot of hurdles to overcome as it is, and the detection or announcement of a successful attack would add yet another.

Re: Bitcoin exchange rate reached $100 USD per BTC

#560

Post by jwallaceparker » Tue, Apr 02, 2013, 3:29 PM UTC

jvm wrote: post #412

jwallaceparker wrote: post #78

Earlier quoted context omitted.

"The problem is that the value of a currency is supposed to also be somehow related to its utility in acquiring goods and services. When it is rarely used to that effect, people may reconsider their investment in the currency." Gold and silver stand in opposition to this statement. You can't buy groceries with gold or silver coins, but they're a fantastic store of value and time-tested investment. Furthermore, accord…

> You can't buy groceries with gold or silver coins, but they're a fantastic store of value and time-tested investment. Real value of gold: http://static.cdn-seekingalpha.com/uploads/2013/2/18/1019887... That is very much not my idea of a "fantastic store of value." Not unlike bitcoin, its value appears to vacillate wildly. The S&P 500 looks tame by comparison, and also has the added benefit of a much higher long-run…

I don't know how you can look at your chart and say gold has not maintained its value. Your chart shows gold holding steady with two upward spikes during 1980 and now as hedges against fiat.

Also, I don't know what "real gold price" means. Some details of the measurement would help.

> also has the added benefit of a much higher long-run rate of return

When measured in dollars, which have lost 98% of their value since 1913.