The exponential growth of Bitcoin value explained • Hacker News Board

Re: The exponential growth of Bitcoin value explained

#41

Post by functional_test » Sat, Nov 23, 2013, 3:40 PM UTC

shawnz wrote: post #22

dlsx wrote: post #17

I don't understand bitcoin. In the sense, for a normal person to use it. I don't understand a normal consumer using bit coin. I can't even figure out how to setup this stupid wallet. It has been downloading a block file for over 5 days. How the fuck is this the future? The future is retarded.

Since you are apparently very used to people doing things for you, you might want to look at online wallet services[1] that hold your money. You might think that it is less safe to do things that way, and you are right, but it is no less safe than giving your cash to the bank. EDIT: Sorry for being rude; last night was a long night. What I'm really trying to say is that, by running wallet software locally, you are op…

I just don't think the snark is necessary here. I'm pretty technically savvy and I found the wallet setup process to be... unintuitive. For example, transactions didn't show up until I told my wallet to sync back to before I created it because Multibit doesn't sync by default to a sane time.

Also, it's demonstrably less safe to give your Bitcoin wallet to a site than to give your cash to a bank. To imply that the security and insurance of these sites is comparable to banks is laughable -- you frequently hear about sites getting hacked and losing all of their BTC.

Of course, banks have other problems (depending especially on how you view the Fed), but disingenuous claims like this do nothing to help Bitcoin.

Re: The exponential growth of Bitcoin value explained

#42

Post by redwood » Sat, Nov 23, 2013, 3:48 PM UTC

dlsx wrote: post #17

I don't understand bitcoin. In the sense, for a normal person to use it. I don't understand a normal consumer using bit coin. I can't even figure out how to setup this stupid wallet. It has been downloading a block file for over 5 days. How the fuck is this the future? The future is retarded.

Please use the R word in a respectful manner. This isn't 4chan.

Re: The exponential growth of Bitcoin value explained

#43

Post by craigyk » Sat, Nov 23, 2013, 3:55 PM UTC

VMG wrote: post #40

stinkytaco wrote: post #34

Earlier quoted context omitted.

People are critical of these services, but the poster you're replying to is correct: bitcoin is not ready for prime time. As much as the bitcoin faithful would like to deny it, bitcoin will not be widely adopted until there is a financial services industry around it. The necessity of credit, the convenience of easy payment, the security of your money in a bank, it's just too tempting for people to walk away from. Nev…

That's the most exciting thing about Bitcoin. The protocol and the technology is sound, just imagine how it will explode once the UX is polished. You're looking at the internet in the BBS stage right now.

In this analogy does that make bitcoin the future AOL?

Re: The exponential growth of Bitcoin value explained

#44

Post by craigyk » Sat, Nov 23, 2013, 3:58 PM UTC

joezydeco wrote: post #36

judk wrote: post #23

Earlier quoted context omitted.

If you aren't spending, you are speculating. A unit BTC is currency, not a producer of value.

Why would I spend at this point? The deflationary aspect is just too hard to work with. I have a $8,000 iPod Touch in my pocket that I bought in 2011 when I cashed in 10BTC @ $30.

This point is probably too subtle for a lot of BT fans.

Re: The exponential growth of Bitcoin value explained

#45

Post by epscylonb » Sat, Nov 23, 2013, 4:31 PM UTC

thaumasiotes wrote: post #26

betterunix wrote: post #8

The article asserts this: "All technologies eventually become outdated" There are easy counterexamples: * Wheels * Fire * Knives These are technologies that predate written records (did I mention writing as another example?) yet they all remain use and are actually fundamental in our daily lives. I am not going to claim that fiat currency will be so enduring, but I see no reason to assume that it will be replaced by…

> I am not going to claim that fiat currency will be so enduring I don't get what you're trying to say. Bitcoin is a fiat currency.

The definition and use of the word fiat is interesting, in Latin it means "let it be done".

You could say that the creator of Bitcoin decreed that it had value (I'm not sure I would agree), but it's still different from government backed money because nobody is forced to use Bitcoin (to pay taxes for example).

It certainly seems that within the Bitcoin community the word fiat now means government backed money, I suspect if Bitcoin becomes more successful it may end up redefining the word.

Re: The exponential growth of Bitcoin value explained

#46

Post by Luc » Sat, Nov 23, 2013, 4:35 PM UTC

redwood wrote: post #42

dlsx wrote: post #17

I don't understand bitcoin. In the sense, for a normal person to use it. I don't understand a normal consumer using bit coin. I can't even figure out how to setup this stupid wallet. It has been downloading a block file for over 5 days. How the fuck is this the future? The future is retarded.

Please use the R word in a respectful manner. This isn't 4chan.

Go wag your finger somewhere else. This isn't Metafilter.

It's such a nice pun, too. Retarded means 'slowed down, delayed', as in 'tardiness' for example.

Re: The exponential growth of Bitcoin value explained

#47

Post by mcculley » Sat, Nov 23, 2013, 5:54 PM UTC

lumberjack wrote: post #6

The article just supposes that Bitcoin is the next big thing and then it portrays where we might be in terms of adoption if indeed the supposition is right. But I would rather want to know why people are adopting Bitcoin and what they are exchanging it for. That way I could truely understand the Bitcoin economy and whether it is actually the next big thing or not. I don't want to be a harsh critic but I always get my…

Folks are already using bitcoin for international commerce and remittances where they were underserved by banks and services like Western Union or PayPal.

Bitcoin only needs to be useful for one kind of transaction for it to be enormously valuable. Once it is useful for some class of transactions it will be more valuable for other kinds of transactions. This is a classic network effect.

The particular kind of transaction where I am convinced it will take off is international commerce. There are lots of potential transactions that are simply not happening because of the hassles of moving money around between currencies and banking/government regimes. There are lots of other transactions happening that are slow and expensive for the same reason. So bitcoin is providing value there, both by making existing transactions cheaper and making other transactions possible. I'm specifically thinking of capital and labor in currently underserved markets that can now more easily be exchanged where they were not before.

Then there are whole classes of transactions that bitcoin makes possible that were not possible before. For example, right now one could write a bot that receives and spends bitcoin to provide some service and not have to get any permission from a bank or government to do so. What kind of cool weird services are going to come from that?

Re: The exponential growth of Bitcoin value explained

#48

Post by thaumasiotes » Sun, Nov 24, 2013, 1:17 AM UTC

betterunix wrote: post #38

thaumasiotes wrote: post #26

Earlier quoted context omitted.

> I am not going to claim that fiat currency will be so enduring I don't get what you're trying to say. Bitcoin is a fiat currency.

Fiat currencies have value because of laws.

This is only true if the relevant government sets prices by law. Every time that's been tried, it's been a complete disaster.

Re: The exponential growth of Bitcoin value explained

#49

Post by betterunix » Sun, Nov 24, 2013, 1:28 AM UTC

thaumasiotes wrote: post #48

betterunix wrote: post #38

Earlier quoted context omitted.

Fiat currencies have value because of laws.

This is only true if the relevant government sets prices by law. Every time that's been tried, it's been a complete disaster.

...or if the law requires certain payments to be made (taxes, fines, etc.), provides legal protections for creditors when people default on their debts, and gives courts the legal power to require one person to pay another. This is what drives the demand for fiat currencies, and as long as the supply remains limited the currency will have value.

Re: The exponential growth of Bitcoin value explained

#50

Post by thaumasiotes » Sun, Nov 24, 2013, 1:30 AM UTC

epscylonb wrote: post #45

thaumasiotes wrote: post #26

Earlier quoted context omitted.

> I am not going to claim that fiat currency will be so enduring I don't get what you're trying to say. Bitcoin is a fiat currency.

The definition and use of the word fiat is interesting, in Latin it means "let it be done". You could say that the creator of Bitcoin decreed that it had value (I'm not sure I would agree), but it's still different from government backed money because nobody is forced to use Bitcoin (to pay taxes for example). It certainly seems that within the Bitcoin community the word fiat now means government backed money, I susp…

So, in the historic situation in which a farmer's business is all conducted in copper (or in kind) and taxes are assessed in silver, would you consider silver a fiat currency?

A fiat currency is fiat because it gives you no claim to anything. A pound of silver gives you a claim to a pound of silver. A US dollar used to give you a claim to a certain weight of gold. Today the price of gold is uncontrolled.

(Side note: owing to the special nature of facio/fio, using "fiat" doesn't necessarily require an agent. The verb is indeed the passive form of "facio" [do/make], but it's also the standard way to express [happen/occur].)