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A Look at the Bitcoin Economy

thegenesisblock.com

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Re: A Look at the Bitcoin Economy

#21

Post by nwh »

Aldo_MX wrote: post #17
gojomo wrote: post #9

I find it interesting that the current value of all mined Bitcoins is currently about $5.4B, per http://blockchain.info/charts/market-cap . (I've seen this value described as "one Nakamoto".) And, the number of full peer nodes is about 130,000 – per the network scan done by http://getaddr.bitnodes.io/ . To an extent, the total value is an emergent property of all the nodes together. But for grins we could distribute…

I find surprising the fact that you say it uses about 15Gb, 6 months ago it used around 10Gb and at this point I can imagine that around 2016 it will need around 100Gb and the number will keep increasing...

The cap on the block size means it'll increase at a maximum per year, I think it's something like 60GB if every block is filled to the brim.

Re: A Look at the Bitcoin Economy

#22

Post by TylerE »

kissickas wrote: post #20
TylerE wrote: post #16

Earlier quoted context omitted.

> As a merchant, I'd love it if our customers all paid in BTC as it would eliminate all fraudulent/charge-backed transactions which cost us $15 each time. As a customer I would never pay with BTC for exactly the same reason.

It appears obi-nine is ghost-blocked or whatever it's called, which is unfortunate because I have the same question. Why wouldn't you, if you trust the merchant?

Because I don't trust the merchant, at least not when I don't have to.

Re: A Look at the Bitcoin Economy

#23

Post by jval »

With respect, the press is regularly quoting how many places now 'accept bitcoin' but it is all really a vanity metric. I know it is difficult to know how much these merchant accounts get used without internal information from the providers themselves, but from all internal accounts I have heard, the usage is dismal. For no surprising reason customers are generally disinterested in purchasing anything with Bitcoin that they can already purchase with their credit card.

I think Bitcoin is going to be revolutionary but the application is lacking - entrepreneurs really need to find a real world application where the use of Bitcoin actually improves the experience. Remittances and International Money Transfers are the first legal industry I can think of where that will work, but businesses in that area need time to grow and navigate the uncertain regulatory environment before Bitcoin will actually see adoption that really means something.

Re: A Look at the Bitcoin Economy

#24

Post by nmarley »

lumberjack wrote: post #5

What is an example of a service* or product* that is served better with cryptocoins than with cash, bank transfers or credit cards? What are people spending bitcoins on and why? That would be nice to know and definitely more informative than a graph of daily activity within the blockchain. * preferably something mundane and totally within the boundaries of the law

Technical books in electronic format: http://www.cointagion.com/

Re: A Look at the Bitcoin Economy

#25

Post by kissickas »

TylerE wrote: post #22
kissickas wrote: post #20

Earlier quoted context omitted.

It appears obi-nine is ghost-blocked or whatever it's called, which is unfortunate because I have the same question. Why wouldn't you, if you trust the merchant?

Because I don't trust the merchant, at least not when I don't have to.

So even if you go to the same restaurant twice a month, you would never pay cash? I'm not sure we're understanding each other here.

Re: A Look at the Bitcoin Economy

#26

Post by industrialwaste »

So, if I had invested when I planned to a couple of years ago (or actually bought decent hardware to mine on) I would have made a decent return. But now I'm curious if we're in a bubble that will decrease in popularity or if it's still something that will continue to be on the rise.

Seems to me that all of the recent news has brought attention to bitcoin which has helped with it's popularity. Is it something that will continue to rise or will it fall once people aren't talking about it as much?

Can anyone weigh in with their opinions?

Re: A Look at the Bitcoin Economy

#27

Post by JohnDoe365 »

jval wrote: post #23

With respect, the press is regularly quoting how many places now 'accept bitcoin' but it is all really a vanity metric. I know it is difficult to know how much these merchant accounts get used without internal information from the providers themselves, but from all internal accounts I have heard, the usage is dismal. For no surprising reason customers are generally disinterested in purchasing anything with Bitcoin th…

Usage will rise once the value starts to drop. Why would anybody spend on real god as long as the value is soaring? This is of course only true for those currently holding Bitcoins.

The current rise of Bitcoins' value is actually very unhealthy for the market.

Re: A Look at the Bitcoin Economy

#28

Post by joosters »

How do (real world) shops accept bitcoin? I thought that it takes some time for a transaction to be confirmed by the blockchain. Even if it is a matter of minutes, you can't expect customers to wait by the checkout until their payment is cleared. And yet without this confirmation, you are opening yourself up to fraud.

Re: A Look at the Bitcoin Economy

#29

Post by mateuszf »

joosters wrote: post #28

How do (real world) shops accept bitcoin? I thought that it takes some time for a transaction to be confirmed by the blockchain. Even if it is a matter of minutes, you can't expect customers to wait by the checkout until their payment is cleared. And yet without this confirmation, you are opening yourself up to fraud.

Doing fraud is very unprofitable for amounts of money which are not huge. Companies like BitPay take this risk as man in the middle.

Re: A Look at the Bitcoin Economy

#30

Post by ra »

industrialwaste wrote: post #26

So, if I had invested when I planned to a couple of years ago (or actually bought decent hardware to mine on) I would have made a decent return. But now I'm curious if we're in a bubble that will decrease in popularity or if it's still something that will continue to be on the rise. Seems to me that all of the recent news has brought attention to bitcoin which has helped with it's popularity. Is it something that wil…

The market price of BTC has grown fairly consistently on the logarithmic scale for a couple of years now. There have been ups and downs, but the majority of the price growth obviously comes from an increase in demand that isn't being met by supply. Supply will not increase, but demand might.

What would further increase demand?

Well the status quo, i.e. BTC breaking new market highs, having crashes and recovering, that's news and so increases the public awareness of BTC, and so more people buy.

More companies accepting BTC will increase it's usefulness (therefor provide some intrinsic value), more startups working to make transacting in BTC easier will also help increase demand.

What would decrease demand in a meaningful way?

Unfavourable legislative changes. These are mitigated in that they have to happen on a country by country basis, but generally countries follow the leader on matters of new policy or policy related to new technology.

At the moment most BTC demand is for speculative hoarding by investors. Most realise that it's a gamble where the downside is losing 100% of capital, but the upside is potentially 1000% or more.

There are undoubtedly future market rallys and crashes ahead, but I think in the long run BTC has a long way to go. It's very difficult to "price" BTC because it generates no return in it's own right, and has no intrinsic commodity value. It's a gamble but the potential return seems worth the risk of potentially losing 100% of your capital.

It is important that you regard BTC as speculative - i.e. not an investment.

In the end the long term survival of BTC will depend on it's adoption. So if you want to make money, horde some BTC and work on a project that makes uses it to solve a real business problem for a meaningful market.

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