Bitcoins: The Second Biggest Ponzi Scheme in History • Hacker News Board

Re: Bitcoins: The Second Biggest Ponzi Scheme in History

#141

Post by hershel » Sun, Dec 01, 2013, 4:01 PM UTC

salient wrote: post #31

nwh wrote: post #11

Earlier quoted context omitted.

> Do we actually know how many large mining groups we need to make up 51% of the processing power of the block chain Two. GHash.io and BTCguild make up 27% each, for a total of 54%. https://blockchain.info/pools GHash.io had actually been acting maliciously according to some users on Bitcointalk, but the operator claims that was a rogue actor inside that has been dealt with. Double spends against betting sites in par…

We need digital currencies that can only ever be mined efficiently with a CPU, and there need to be many more blocks with lower rewards so that people don't need to join pools if they don't want to. They need to be able to earn "something" (not zero) even with a low-end CPU or when the difficulty gets too great, and close to the point of reaching the maximum number of coins. I think there weren't even 10 percent Bitc…

The scrypt hardness parameters are related to both processor and cache. Once hardness gets big enough,GPU mining won't make sense, because each GPU core has relatively little cache vs cpu.

Re: Bitcoins: The Second Biggest Ponzi Scheme in History

#142

Post by gnaritas » Sun, Dec 01, 2013, 4:02 PM UTC

berberous wrote: post #97

netcan wrote: post #59

Earlier quoted context omitted.

All money is a bubble, IMO. >> price rise is being sustained by many new speculators/investors, and at some point, that will inevitably collapse It may but I don't think its inevitable. Many speculators/investors are buying bitcoins because they believe bitcoins will be used in the future as an important currency. If that happens, there will be even more demand for bitcoin and the price will be high forever. Its spec…

Well, obviously there are supposed reasoned justifications for the rise in prices. That's true of probably all bubbles. Humans are less rational creatures, than rationalizing creatures. We like stories that convince ourselves we are behaving rationally. Robert Schiller, the Yale economist and bubble-proponent, suggests diagnosing bubbles based on a checklist-based approach similiar to the way depression or other medi…

Crypto currency definitely has a big future, that I can give you this 12a9hmRF8Aueu38tXyuj7eswTUgsemszp2 and you can pay me there without a bank or government in between is amazing. Anyone who's integrated with a payment processor to run an online business will appreciate the value offered by crypto currencies.

Unfortunately I don't think BTC is that currency, it's built in limit is a terrible idea conceived from the mind of someone who doesn't understand the difference between money and commodities. BTC will never be a good currency, it'll never be stable enough. BTC is e-gold, not e-cash, and it'll suffer the same fate as gold, that of a value holding commodity but not a currency. However, that's a petty flaw easily fixed and BTC paved the way for a whole market of crypto currencies by being open source with each trying slightly different approaches based on different ideas about how currencies work. This is awesome. Regardless of which few crypto currencies eventually dominate, it is the future.

Re: Bitcoins: The Second Biggest Ponzi Scheme in History

#143

Post by zwily » Sun, Dec 01, 2013, 4:02 PM UTC

jervisfm wrote: post #139

pyalot2 wrote: post #42

> In this sense, Bitcoins is not a Ponzi scheme. It is simply a supermoney scheme. Admits that bitcoin is not a ponzi scheme in his own article. > The money was siphoned off from the beginning. Somebody owned a good percentage of the original digits. Implies that most bitcoins are owned by satoshi nakamoto, without substantiating this claim by any number to quantify the impact. The estimated stash of satoshi is about…

> There will be an eventual cap at 21 million bitcoins. At the increasingly slow rate that coins are produced, this won't happen for some. But assuming that bitcoins are still around and in use at the point in time in the future when this happens, what will be the effect of this? The supply is fixed and no more can be produced; and since it's still around, chances are there is demand / usage that would likely grow. T…

Miners will continue to mine for the transaction fees.

Re: Bitcoins: The Second Biggest Ponzi Scheme in History

#144

Post by ceejayoz » Sun, Dec 01, 2013, 4:03 PM UTC

bmelton wrote: post #133

ceejayoz wrote: post #121

Earlier quoted context omitted.

> Is BTC considered 'currency' by the US government? Do its transfers necessitate reporting to the government? If I sent a thousand dog biscuits to my home land, does the government need to be involved? Under what law? Almost certainly, under a variety of money laundering laws. You can't just convert cash into diamonds/gold/Bitcoins and thumb your nose at the authorities saying "look, no currency!"

Sending money back home is a far different scenario than laundering, and the assertion that it is assumes bad faith from the beginning. I'm not suggesting you don't have a point, but the idea that BTC has value is, I think, arbitrary at this point. There are thousands of leaves littering the lawn in my back yard right now -- surely I could send those to a foreign land without having to declare it, right? An argument…

> Sending money back home is a far different scenario than laundering, and the assertion that it is assumes bad faith from the beginning.

The government can and will assume bad faith in any transfer involving large amounts of money and/or items of value.

> Similarly, if I send $10,000 worth of virtual roses to friends on Facebook, the government is not interested, and I haven't seen anything that convinces me, at the moment, that BTC should be treated differently than any other all-digital good.

Actually, I believe Facebook would be required to report that transfer to the IRS.

Re: Bitcoins: The Second Biggest Ponzi Scheme in History

#145

Post by gutnor » Sun, Dec 01, 2013, 4:03 PM UTC

NikolaTesla wrote: post #123

pyalot2 wrote: post #42

> In this sense, Bitcoins is not a Ponzi scheme. It is simply a supermoney scheme. Admits that bitcoin is not a ponzi scheme in his own article. > The money was siphoned off from the beginning. Somebody owned a good percentage of the original digits. Implies that most bitcoins are owned by satoshi nakamoto, without substantiating this claim by any number to quantify the impact. The estimated stash of satoshi is about…

The real danger of Bitcoins is not its volatility, but its potential to illustrate the downside of all fiat based currency when compared with something like Bitcoins whose money supply does not fluctuate based upon the needs of a few. If that fact ever reaches the consciousness of enough people worldwide, watch out.

Thing is Bitcoin fails miserably as a currency TODAY(2013). It currently cannot be used as a currency because of its volatility, unlike other fiat currencies, it cannot be controlled, potentially destroying any economy based on it. ( Think of it, some random panic on the dollar supply would send the value of the dollar spiraling to 100 time its value over the course of 1 year, with absolutely no way the US could do anything about it )

Bitcoin is successful as a proof of concept of how you can create a modern currency that retains most the benefit of electronic and physical money. For the supply, I have just the opposite reaction. I used to think that the limited supply of bitcoin was a great idea, now I'm thinking all the clever people that wanted to get us out of the gold standard may have had a point after all.

It is also not a ponzi scheme, just a risky investment.

Re: Bitcoins: The Second Biggest Ponzi Scheme in History

#146

Post by [deleted] » Sun, Dec 01, 2013, 4:03 PM UTC

jervisfm wrote: post #139

pyalot2 wrote: post #42

> In this sense, Bitcoins is not a Ponzi scheme. It is simply a supermoney scheme. Admits that bitcoin is not a ponzi scheme in his own article. > The money was siphoned off from the beginning. Somebody owned a good percentage of the original digits. Implies that most bitcoins are owned by satoshi nakamoto, without substantiating this claim by any number to quantify the impact. The estimated stash of satoshi is about…

> There will be an eventual cap at 21 million bitcoins. At the increasingly slow rate that coins are produced, this won't happen for some. But assuming that bitcoins are still around and in use at the point in time in the future when this happens, what will be the effect of this? The supply is fixed and no more can be produced; and since it's still around, chances are there is demand / usage that would likely grow. T…

[deleted]

Re: Bitcoins: The Second Biggest Ponzi Scheme in History

#147

Post by melvinmt » Sun, Dec 01, 2013, 4:04 PM UTC

theboywho wrote: post #80

Important to note: The author of the article, Gary North, is the same guy who predicted a "failure of the global Information Technology (IT) infrastructure and that it would precipitate severe disruption and the complete collapse of the international economy, leaving American Christians to restore society following the collapse." Also, he "favors capital punishment for a range of offenders; these include women who li…

Why is that relevant for this article?

Re: Bitcoins: The Second Biggest Ponzi Scheme in History

#148

Post by aestra » Sun, Dec 01, 2013, 4:04 PM UTC

ashray wrote: post #22

gokhan wrote: post #14

The individual who sells the Ponzi scheme makes money by siphoning off a large share of the money coming in. In other words, he does not make the investment. But Bitcoins are unique. The money was siphoned off from the beginning. Only true if we see Satoshi spending his Bitcoins. We have an online store selling baby products and really want to accept Bitcoins but we can't at the moment since Bitcoin is not widespread…

Hi, I suggest that you check out bitpay.com They will bill your customers in bitcoin and will transfer out USD to you so that you don't have to worry about the exchange rate at all. You setup your items in USD as well and they handle the price fluctuations. They do daily payouts to 30 countries in several currencies. I've been using them since April and it's amazing! Sincerely, A happy bitpay customer :) Edit: oh and…

Out of curiosity do you have many people who pay in bitcoin?

Re: Bitcoins: The Second Biggest Ponzi Scheme in History

#149

Post by sjtgraham » Sun, Dec 01, 2013, 4:05 PM UTC

theboywho wrote: post #80

Important to note: The author of the article, Gary North, is the same guy who predicted a "failure of the global Information Technology (IT) infrastructure and that it would precipitate severe disruption and the complete collapse of the international economy, leaving American Christians to restore society following the collapse." Also, he "favors capital punishment for a range of offenders; these include women who li…

Ad hominem.

Re: Bitcoins: The Second Biggest Ponzi Scheme in History

#150

Post by nmarley » Sun, Dec 01, 2013, 4:06 PM UTC

jervisfm wrote: post #139

pyalot2 wrote: post #42

> In this sense, Bitcoins is not a Ponzi scheme. It is simply a supermoney scheme. Admits that bitcoin is not a ponzi scheme in his own article. > The money was siphoned off from the beginning. Somebody owned a good percentage of the original digits. Implies that most bitcoins are owned by satoshi nakamoto, without substantiating this claim by any number to quantify the impact. The estimated stash of satoshi is about…

> There will be an eventual cap at 21 million bitcoins. At the increasingly slow rate that coins are produced, this won't happen for some. But assuming that bitcoins are still around and in use at the point in time in the future when this happens, what will be the effect of this? The supply is fixed and no more can be produced; and since it's still around, chances are there is demand / usage that would likely grow. T…

> When this is no longer the case, who will agree to do this work then?

The miners will still get transaction fees even after all the Bitcoins have been mined.