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Why Bitcoin Matters

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Re: Why Bitcoin Matters

#61

Post by nhaehnle »

hooande wrote: post #40

Andressen is making bitcoin out to be a decentralized paypal, when it was more intended to be a form of currency. It makes more sense as a long term investment or speculative bet than it does a way to transfer money from point A to point B. An analogy would be if person A and person B conducted a transaction by converting their money from dollars to euros or vice versa (assuming A and B are both in the same country).…

The micropayments claim is a red herring. If Bitcoin were to actually take off for micropayments, it would no longer scale, and/or the operation of Bitcoin nodes would be limited to people with very serious hardware. At that point, we're back to the game that is currently being played by banks, just with different players in charge.

So it's understandable that many people hope that such a transition will happen and that they will end up in charge after that transition.

For the society as a whole, however, Bitcoin does not have an inherent advantage that is sustainably scalable.

Re: Why Bitcoin Matters

#62

Post by [deleted] »

pyvpx wrote: post #46
ye wrote: post #36

Earlier quoted context omitted.

Yeah, you described pretty much the worst case scenario where everything goes through fiat. But once Bitcoin penetration is significant and people start getting paid in Bitcoin (already happening) and accept it as payment (also already happening), all these exchange fees go away. With fiat you're stuck with the fees forever. Also your 0.5% assumption is wrong. You can place a buy ad on LocalBitcoins and actually buy…

does bitcoin have an intrinsic value? if so, what?

[deleted]

Re: Why Bitcoin Matters

#63

Post by ye »

pyvpx wrote: post #46
ye wrote: post #36

Earlier quoted context omitted.

Yeah, you described pretty much the worst case scenario where everything goes through fiat. But once Bitcoin penetration is significant and people start getting paid in Bitcoin (already happening) and accept it as payment (also already happening), all these exchange fees go away. With fiat you're stuck with the fees forever. Also your 0.5% assumption is wrong. You can place a buy ad on LocalBitcoins and actually buy…

does bitcoin have an intrinsic value? if so, what?

Does dollar have an intrinsic value?

Actually, can you even define "intrinsic value" without going in circles or defining it simply as current value?

Re: Why Bitcoin Matters

#64

Post by kolev »

ye wrote: post #36
minimax wrote: post #16

Bitcoin is the first Internet-wide payment system where transactions either happen with no fees or very low fees (down to fractions of pennies). Existing payment systems charge fees of around 2 percent to three percent As long as consumers are paid in their local currency and vendors pay their employees, their taxes, and their other costs in local currency, then bitcoin as a payment technology has similar costs as cr…

Yeah, you described pretty much the worst case scenario where everything goes through fiat. But once Bitcoin penetration is significant and people start getting paid in Bitcoin (already happening) and accept it as payment (also already happening), all these exchange fees go away. With fiat you're stuck with the fees forever. Also your 0.5% assumption is wrong. You can place a buy ad on LocalBitcoins and actually buy…

LocalBitcoins.com is one of the most expensive places to acquire (only small quantities of) bitcoins... and the riskiest.

Re: Why Bitcoin Matters

#65

Post by venomsnake »

Lambdanaut wrote: post #49
pyvpx wrote: post #46

Earlier quoted context omitted.

does bitcoin have an intrinsic value? if so, what?

Define "value", because I'm pretty sure that 99% of globally used currencies won't have this magical "intrinsic value" that you speak of.

The usd has intrinsic value - it saves you from years in jail if you cough up as much as Uncle Sam requires of you every year.

Re: Why Bitcoin Matters

#66

Post by kolev »

minimax wrote: post #16

Bitcoin is the first Internet-wide payment system where transactions either happen with no fees or very low fees (down to fractions of pennies). Existing payment systems charge fees of around 2 percent to three percent As long as consumers are paid in their local currency and vendors pay their employees, their taxes, and their other costs in local currency, then bitcoin as a payment technology has similar costs as cr…

I got tired arguing with people with vested interest in Bitcoin that Bitcoin is not cheaper. You see a lot of people on Reddit getting super excited buying junk at Overstock and saying: "The banks got nothing!" without realizing that: 1) Coinbase sold their bitcoins at Bitstamp. 2) When more people sell than buy, Coinbase needs to wire money from Bitstamp to their European bank account and then to their US one; 3) Overstock gets an ACH daily from Coinbase; 4) If you got your bitcoins from Coinbase, an ACH was made for the purchase and if Coinbase gets more buys than sells, it needs to daily wire money from their US bank account to their European one, and then from it to Bitstamp. In other words, this over complicated process involves a lot more banking activity than credit cards! I get 1.5% cash back without any limits from my PayPal Debit Card and Coinbase charges me 1% + $0.15 to buy bitcoins.

Re: Why Bitcoin Matters

#67

Post by yummyfajitas »

candybar wrote: post #22
yummyfajitas wrote: post #17

Earlier quoted context omitted.

You're doubling the problem no matter how you look at it, because the problem of you sending money to the bitcoin exchange is the exact same problem as you sending money to the merchant. No, because we've introduced loose coupling. I need to figure out how to turn USD into BTC. My wordpress guy needs to figure out how to turn BTC into UAH. Either of us can swap out our solution and the other doesn't care. Suppose we…

No, you haven't introduced anything, because sending money to a bitcoin exchange is exactly as hard as sending money to a merchant. I already conceded the global bridge argument, but that's just a legal loophole. Authorities can easily legally treat depositing money into a bitcoin exchange as sending money abroad and make it just as hard.

If armed men want to stop you from using bitcoin, they can. On the other hand, if Paypal doesn't do business in Cambodia, I can still hire a web designer there.

Re: Why Bitcoin Matters

#68

Post by mgulaid »

ye wrote: post #36
minimax wrote: post #16

Bitcoin is the first Internet-wide payment system where transactions either happen with no fees or very low fees (down to fractions of pennies). Existing payment systems charge fees of around 2 percent to three percent As long as consumers are paid in their local currency and vendors pay their employees, their taxes, and their other costs in local currency, then bitcoin as a payment technology has similar costs as cr…

Yeah, you described pretty much the worst case scenario where everything goes through fiat. But once Bitcoin penetration is significant and people start getting paid in Bitcoin (already happening) and accept it as payment (also already happening), all these exchange fees go away. With fiat you're stuck with the fees forever. Also your 0.5% assumption is wrong. You can place a buy ad on LocalBitcoins and actually buy…

But the bottom line argument is that when everyone gets paid in the same currency, the exchange fees go away. This can happen with US $ or Yan.

Re: Why Bitcoin Matters

#69

Post by scott_s »

eatitraw wrote: post #6
easy_rider wrote: post #4

>The criticism that merchants will not accept Bitcoin due to its volatility is also incorrect. Bitcoin can be used entirely as a payment system; merchants do not need to hold any Bitcoin currency or be exposed to Bitcoin volatility at any time. Any consumer or merchant can trade in and out of Bitcoin and other currencies any time they want. I don't understand this. Someone is taking the risk right now. Currently it's…

> I don't understand this. Someone is taking the risk right now. Correct. > Currently it's the exchanges and merchants directly, because they rely on the exchanges. Incorrect. There is the solution: https://bitpay.com/ , which automatically does conversion for a small fee. Buyers pay in bitcoin, but sellers receives fiat money(e.g. USD). The risk is taken by bitpay, sellers always receive fixed amount in fiat money,…

How "automatically"? Seconds? Minutes? Hours? In other words, how much time passes between the customer paying X bitcoins, and those are converted into Y USD?

Re: Why Bitcoin Matters

#70

Post by Guvante »

known wrote: post #30

There are only $1 trillion cash/coins in circulation. Everything else is debt. http://www.federalreserve.gov/releases/h41/current/h41.htm

The USD is a debt based currency, so that is expected.

Bitcoins are a proof of work based currency, but unfortunately it acts more like a commodity at the moment.

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