Bitcoin is fiat, it's not backed by anything of real value and doesn't have a government or a strong (and I mean national-government-kind strong) player behind it that is willing to devote actual resources to prop it up (which is what all other fiat monies have and which is why they usually stay around for a century or so, after that they either become obsolete or their value greatly diminishes due to inflation). It has all of the Aristotelian properties of money (durable, portable, fungible), and some extra ones too, except intrinsic value. So it's not money according to Aristotle. When a better system comes along (and it would be trivially easy for that to eventuate, imagine, e.g. China or a major corporation or - even better - an industry association offering an altcoin backed by gold, agricultural land, shares, face time with celebrities, mentoring time - hey these are good ones! etc.), the value of bitcoins will go to zero as everybody will want the new, better altcoin that has at least some intrinsic value. The same death spiral cannot happen in the case of government-backed fiats when a new fiat is introduced, for a number of reasons. Bitcoin is inertia-backed fiat. I'll take the government-backed variety any time.
Bitcoin breaks $200
101–110 of 209 posts
Re: Bitcoin breaks $200
#102Earlier quoted context omitted.
Ah, the old and false "holding" argument. 2 million coins have changed hands in the last 30 days: http://bitcoinity.org/markets/list?currency=ALL&span=30d And that is just on these exchanges, not even counting other places of exchanges (coinbase which is probably the 2nd largest coins seller in the US), or purchases (Bitpay signed up 10 thousand vendors!), etc. If this rate is kept, the entire existent volume of bitc…
> It doesn't matter if it is 1 coin changing hands 12 million times, or 12 million coins changing hands one time each. Volume is volume. Correct > And it proves that not that many coins are being hoarded. False. There's nothing in what you said to give any logical or empirical evidence that coins aren't being hoarded. You'd be better off making the argument that it doesn't matter that they're being hoarded because th…
Strictly speaking, you are right. It is theoretically possible that 11,999,999 coins are hoarded, and only 1 coins is being exchanged many time.
I should have said simply that because the market is very liquid, it does not seem to suffer from hoarding and/or hoarding does not matter.
Re: Bitcoin breaks $200
#103I tried to buy bitcoins when they were $60. I look for sites that would sell me bitcoins for USD. It was so hard and the ways to buy them were so damn complicated. I had to sign up for a 3rd party site to import bitcoin to mtgox. The 3rd party site needed me to upload my personal identity information to verify my bank account. I was ready to do that as well, except they said it'd take 10+ days to verify. Also someone…
I experienced similar frustration when trying to buy bitcoins. I ended up using localbitcoins.com, and had an excellent experience.
The site matches up private users (by geographic location by default) wishing to buy bitcoins with those wishing to sell. It offers "feedback" ratings for traders, and an escrow system where the site confirms your coins have been sent to it and placed in reserve, and these get released to you once the seller confirms receipt of your funds, either by texting a code from their phone or by using the website. There were no onerous fees, and my entire trade was completed within hours. Typical trading methods would include internet bank transfer (which is what I did), or even meeting in person with cash (riskier but more anonymous I guess).
>Also someone explain to me how that is anonymous when they have all my information if I had uploaded my driver's license and my bank account information.
Nobody claimed it was anonymous. And companies acting as "money transmitters" (or who the feds decide to consider as such) have a bunch of AML/KYC regulations they are required to follow, hence the whole ID thing. You can enhance the anonymity of your coins in various ways, typically by services which chop them up and shuffle them between many addresses to obfuscate their trail in the blockchain (so-called "mixers").
>And this fluctuating price isn't very impressive either
What concerns you about it? For many people I guess the short-term fluctuations aren't such an issue (e.g. those playing the long game with their bitcoin investment; or those only holding coins for a short time to make a specific purchase, particularly where the sales platform offers a hedging feature like Silk Road apparently did).
Re: Bitcoin breaks $200
#104For once my general laziness looks like it is paying off. Mined a couple bitcoins years and years ago, and was too lazy to sell them at the time.
Aha, but did your general laziness prevent you from properly storing the keys?
Re: Bitcoin breaks $200
#105US default now-or-later squabble certainly fueled bitcoin. It is becoming de-facto plan B for big players.
Um, no. According to blockchain.info and this $200 price, there are less than $2.5 billion worth of bitcoins in circulation, total. The idea that this would somehow serve as a hedge against an economy a thousand times larger is laughable.
Nobody is suggesting that Bitcoin will replace the USD (yet). For now, some people are going into Bitcoin because it cannot be confiscated. And govt default is correlated with crazy taxation measures. Take a look at what France is doing now.
Re: Bitcoin breaks $200
#106US default now-or-later squabble certainly fueled bitcoin. It is becoming de-facto plan B for big players.
wow! that will have big implications.. but i wonder what would do vey rich people invest in bitcoins instead of gold wich is probably safer right now? Thats not my area, but i would like to know if BC could get more attractive than gold in a fallout economy scenario?
Bitcoin is more useful than gold in a society that has the internet.
If you want to prepare for a situation where we no longer have the internet, then gold might be a viable option. But I don't care to consider that possibility, for the same reason I don't care to prepare for a nuclear holocaust. I believe my expected utility/happiness is greater this way.
Re: Bitcoin breaks $200
#107Earlier quoted context omitted.
Bitcoins bought with US dollars last year buy over 40x more than if the dollars had been saved. Bitcoin is here to stay for as long as the internet is.
If I had a Bitcoin for every dotcom company that saw a >40x YoY increase in market cap that hasn't stayed around as long as the internet...
And yet I doubt any of these saw 40x YoY increases topping out at a $2.5 billion valuation.
Re: Bitcoin breaks $200
#108For once my general laziness looks like it is paying off. Mined a couple bitcoins years and years ago, and was too lazy to sell them at the time.
Aha, but did your general laziness prevent you from properly storing the keys?
You're sharp. That's exactly what I'm wondering right now. I think the answer is yes though.
Re: Bitcoin breaks $200
#109Earlier quoted context omitted.
The difference though is that Enron insiders were engaging in immoral and illegal activities. Bitcoin on the other hand is provably not a scam; it is an existing and backed commodity. Market manipulation as an insider is impossible, as there are no insiders; manipulation is only possible by attacking infrastructure or accumulating enough BTC. Future bubbles and crashes are likely, but I predict it's going to continue…
Really? What happens when the founders who mined hundreds of thousands of coins in the early days cash out?
Because the people who were prescient enough to figure out that there was immense unrealised demand for such a system are surely anxious to offload their now increasingly valuable stake in that system, right?
I sure am, back when I was mining and buying at around the 1$ mark I thought to myself; self, you know this is all just games and popcorn, but there'll always be a bigger sucker out there and some day they'll come along and buy all this stuff you're now building, so suck it up and tolerate the jet engine whine of the fans, you'll be rich in the long run.
Not really, though.
Re: Bitcoin breaks $200
#110Earlier quoted context omitted.
The difference though is that Enron insiders were engaging in immoral and illegal activities. Bitcoin on the other hand is provably not a scam; it is an existing and backed commodity. Market manipulation as an insider is impossible, as there are no insiders; manipulation is only possible by attacking infrastructure or accumulating enough BTC. Future bubbles and crashes are likely, but I predict it's going to continue…
Really? What happens when the founders who mined hundreds of thousands of coins in the early days cash out?
Go look at the top 250 addresses, a _majority_ of them have never been spent from. There isn't any conclusive proof that the #1 address (111,111 BTC) belongs to DPR, but it is clearly linked to SR in one way or another. I'd be willing to bet a solid amount of my own holdings that those coins are effectively "dead" (private key lost) along with a good portion of the rest of the addresses that haven't been touched since 2011, or have flat out never been spent from.
Everyone is touting the 12 million number for total coins in circulation right now and 21 million as the maximum amount. In practice both of those numbers are going to be significantly lower.