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You Asked When To Buy Bitcoin...Well Now's Your Chance

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Re: You Asked When To Buy Bitcoin...Well Now's Your Chance

#61

Post by bushido »

guard-of-terra wrote: post #16
DannoHung wrote: post #5

When can I actually use Bitcoin as a currency rather than a speculative investment asset? That's when I want to buy Bitcoin.

What is "currency" for you? People refer to "currency" all the time as if it was one thing. Cash is one kind of currency, plastic is another, bank account - yet another, savings - yet another. Converting between those is not instant and not free. Bitcoin works OK as a bank account. That is "currency".

Converting between Cash, Bank and Plastic(Credit Cards) IS near instantaneous. It may not be free but the speediness hasn't really been in question. Also these are all instruments that store value, but are all different instruments.

Though Bitcoin is NOT yet a currency. It cannot store value, the volatility ensures that.

An example to illustrate: Part I: Cash - Bank etc. If I have $2000 in Cash, Credit Card has a balance of $1000 (maxed out) and $0 in my Checking/Chequing/Savings account (bank).

I can visit a branch that's 10 mins away, and deposit the all the money, total wait time would be I can immediately go to an ATM and withdraw $500. (transaction cost free - $0.30)

After that I can walk back to my home and access all the $1500, this can be:

a) $500 transferred from account to high yield savings account. (transaction cost free)

b) $500 transferred to grand parents using interac (transaction cost free - $1.00)

c) $500 transferred to credit card (transaction cost free) - Note: (i) Credit cards can take up to 3 days to reflect the payment (ii) Credit Cards will consider the original transaction date as the payment date thus not incurring interest for the delay in reflecting the payment and (iii) some credit card issuers will let you make a transaction before the payment is reflected thus reducing the unfortunate "Check kiting"[1] nature of the delay in reflecting the transaction.

Part II: Cash - Bitcoin - Cash Will not go into explaining this in detail, but just answer this 1) Can you take cash and transfer it to bitcoin without using the bank? 2) Will it be nearly as quick converting between instruments as traditional stores of value? 3) In a day or two when you want to make a purchase can you guarantee or even confidently assume that the value will be the same as when you deposited it? Hell can you assure yourself that the value will be the same [1] http://en.wikipedia.org/wiki/Check_kiting

Re: You Asked When To Buy Bitcoin...Well Now's Your Chance

#62

Post by bushido »

guard-of-terra wrote: post #49
vkou wrote: post #43

Earlier quoted context omitted.

Something meaningful assets are priced in. I can go to Europe, and buy things that have fixed Euro prices, with Euros. It's possible because the entire Eurozone economy backs the Euro. No such thing exists for BTC. And no, buying something priced in USD, but having the option to pay for it in BTC doesn't count. At that point, I'm just speculating.

You are talking about day-to-day spendings. I don't understand why fixate on them. They are a very tiny blip in most people's finances. I manage to live most ordinary days of my life without spending any currency. What I care about is raking together money for realty, and otherwise preserving money for the day when I need them. This is where bitcoin is a viable addition.

You really seem to fail to grasp the difference between a currency (store of value) and a speculative investment (in hopes to beat inflation or exponential returns).

Let's make your chain of thought a bit more entertaining, How much of your traditional currency savings (in percentage) are you confident to convert to BTC?

Re: You Asked When To Buy Bitcoin...Well Now's Your Chance

#63

Post by belorn »

pron wrote: post #46
belorn wrote: post #29

Earlier quoted context omitted.

The biggest I can think of is having the ability to give anonymous support. Maybe one day you want to send support a movement for government transparency, but do not want to take the risk of being labeled as a terrorist? Maybe one day you want to send support to a friend in need without having it on the permanent record? Maybe you want to donate money to a security tool like tor, but do not want to risk being put on…

This is actually a good answer, although sending cash (through Western Union) is also an option in those circumstances - very expensive, but less volatile.

Where I live (Sweden) even transaction through western union require identification card, and the clerk is required by law to ask about the nature of the transaction. The transaction will be booked, logged, and "shared" with most countries including the US.

Re: You Asked When To Buy Bitcoin...Well Now's Your Chance

#64

Post by bushido »

collyw wrote: post #33
pyalot2 wrote: post #14

Earlier quoted context omitted.

There's been no "investor" in the history of investment that made money by buying high and selling low.

From my limited understanding of finance, is that not what short selling is? (Followed by buying back at a reduced price).

Short selling is also buying low and selling high. You just do them in reverse order. Or quite literally you borrow the instrument, sell it to someone and then buy it lower (or higher if the position went against you) and give back the borrowed quantity.

Re: You Asked When To Buy Bitcoin...Well Now's Your Chance

#65

Post by writtles »

rthomas6 wrote: post #38
louthy wrote: post #35

Earlier quoted context omitted.

> The problem is the volatility. I'm not sure how that could be fixed. Liquidity.

Say what? How is Bitcoin not liquid?

People have to be able to move in and out of cash via BTC instantly. It currently takes days for most people.

Re: You Asked When To Buy Bitcoin...Well Now's Your Chance

#66

Post by anoncowherd »

pron wrote: post #57
anoncowherd wrote: post #56

Earlier quoted context omitted.

You may think so, but it's not. Imagine a scenario like this. - There's 10 units of wealth in the world - There's 10 units of currency in the world At this point, 1 unit of currency corresponds to 1 unit of wealth. But what if someone presses a button and conjures up 10 units of the same currency into his own bank account? - Still 10 units of wealth in the world - Now there's 20 units of currency in the world .. So n…

That's not how the economy works (international trade is different from local trade, you're not taking employment into account etc.), but for now let's just say that some think a regulated currency is better and some don't. This has little to do with buying Bitcoin now.

>> That's not how the economy works (international trade is different from local trade, you're not taking employment into account etc.), but for now let's just say that some think a regulated currency is better and some don't

Feel free to tell me why what I described there does not correspond to reality in any meaningful way. If you can't, then maybe you should reconsider your position on "regulated" currencies.

Also, you should investigate http://mises.org - they'll tell you all you need to know about economics. You'll find out that governments are always only a net loss on any economy.

Re: You Asked When To Buy Bitcoin...Well Now's Your Chance

#67

Post by glomph »

dobbsbob wrote: post #11

I needed 0.5 coins last week to test something so I loaned and sold them to test an auto exchange bot @$980. Just bought back 0.5 to repay the small IRC loan @$460. Sweet thanks China

How did you have the trust for someone to lend you $500 without knowing them?

Re: You Asked When To Buy Bitcoin...Well Now's Your Chance

#68

Post by Renaud »

pron wrote: post #44
corford wrote: post #34

Earlier quoted context omitted.

Buying domains (namecheap.com), vpn services (privateinternetaccess.com), hosting (bitvps.com), donating to the EFF, buying a ticket on Virgin Galactic, sending money to someone else where doing an international bank transfer would be too expensive for the amount involved, receiving micro donations from other people (maybe you run a popular blog or forum). Admittedly, that's not an enormous list of things but it's a…

But other than the international money transfer (which I don't do very often), you can do all of these with money, and it would be much easier, plus you have the option of chargebacks etc.

Chargebacks are a double-edged sword, so much so that a whole class of scams is using them to defraud people of goods and services. It's even worse for the small business if you consider how much money is tied up by the bank/paypal to allow for the charges to be reversed at least a month after payment has gone through and the goods sent.

There is a need for cashback, but there are circumstances where having that possibility only causes issues. Transactions in fiduciary money can't be reversed. Bitcoin is more like that.

Bitcoin also allows multiple party arrangements where money can be released irreversibly according to various configurations. It allows the implementation of a system similar to an escrow without the escrow having to hold that money (and without requiring a payment for their fee).

And maybe you do not transfer money abroad a lot, but a lot of people do, whether it is buying goods and services from abroad, or simply sending money home if you live abroad (that's about 230 million people who live outside of their country of origin according to the UN[1]).

Bitcoin also allows micropayments, which is an unsolved problem today since you must have a Credit Card to pay anything online and the fees charged prohibit small payments. And I'm not even talking about being able to accept credit card payment...

[1]:http://www.dw.de/more-people-living-abroad-than-ever-says-un...

Re: You Asked When To Buy Bitcoin...Well Now's Your Chance

#69

Post by guard-of-terra »

bushido wrote: post #62
guard-of-terra wrote: post #49

Earlier quoted context omitted.

You are talking about day-to-day spendings. I don't understand why fixate on them. They are a very tiny blip in most people's finances. I manage to live most ordinary days of my life without spending any currency. What I care about is raking together money for realty, and otherwise preserving money for the day when I need them. This is where bitcoin is a viable addition.

You really seem to fail to grasp the difference between a currency (store of value) and a speculative investment (in hopes to beat inflation or exponential returns). Let's make your chain of thought a bit more entertaining, How much of your traditional currency savings (in percentage) are you confident to convert to BTC?

Right now Bitcoin makes around 15% of my savings.

Re: You Asked When To Buy Bitcoin...Well Now's Your Chance

#70

Post by guard-of-terra »

bushido wrote: post #61
guard-of-terra wrote: post #16

Earlier quoted context omitted.

What is "currency" for you? People refer to "currency" all the time as if it was one thing. Cash is one kind of currency, plastic is another, bank account - yet another, savings - yet another. Converting between those is not instant and not free. Bitcoin works OK as a bank account. That is "currency".

Converting between Cash, Bank and Plastic(Credit Cards) IS near instantaneous. It may not be free but the speediness hasn't really been in question. Also these are all instruments that store value, but are all different instruments. Though Bitcoin is NOT yet a currency. It cannot store value, the volatility ensures that. An example to illustrate: Part I: Cash - Bank etc. If I have $2000 in Cash, Credit Card has a bal…

1) Can you take cash and transfer it to bitcoin without using the bank? 2) Will it be nearly as quick converting between instruments as traditional stores of value?

Yes, I can take my cash, dump it into Qiwi machine and btc-e accepts that. It will be faster because Qiwi machines are denser than bank branches.

3) In a day or two when you want to make a purchase can you guarantee or even confidently assume that the value will be the same as when you deposited it?

No, but neither it is with your currency.

Hell can you assure yourself that the value will be the same

Why are we again talking about day-to-day spending? I don't care about the value in one hour, I care about value in one year and Bitcoin shows pretty good performance. It's more reliable than USD/EUR and USD/RUR swing, believe it or not.

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