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Why I'm Interested in Bitcoin

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Re: Why I'm Interested in Bitcoin

#161

Post by drcode »

schrodinger wrote: post #93
drcode wrote: post #67

Earlier quoted context omitted.

> Credit cards can charge 2.5% because they're awesome Some guy in Arizona can set himself up online, sign up for Stripe, have no set fees, and accept a payment from someone in Germany (or NY or Australia) that afternoon. Last I checked, it takes at least a month to apply for and receive a credit card, so this is obviously wrong. Guess what, I could set you up with a bitcoin account and some bitcoins in less than a m…

It doesn't handle fraud in the form of not receiving what you paid for... as a consumer, you can issue a chargeback right now. That doesn't exist for bitcoin, so until we factor in another layer that provides that protection, you can't compare the 2.5% credit card fee to the bitcoin fee.

This is a fair argument. You would use a bitcoin service like bitrated.com in this case that also carries some cost.

Re: Why I'm Interested in Bitcoin

#162

Post by PureApeshit »

XorNot wrote: post #156
PureApeshit wrote: post #96

Earlier quoted context omitted.

Bitcoin being deflationary, storing value in it is very good idea, apart being a bit risky. I also do not see why it should be limited to small payments, bitcoin is full currency not a toy.

Bitcoin being deflationary, the value will never settle. No government wants deflationary money, and you don't either because no one who doesn't have it has any reason to accept permanent servitude from a deflationary currency. Or as I like to put it: why do you think you should get wealthy for doing literally nothing? Not investing, not loading, not accepting any risk, not working?

computer power is deflationary, tablet i bought for 200 euros 2 years ago, oday i can buy same specs for 59 euros... still noone waits and holds till stuff get cheaper, same with bitcoin it will only help environment for massive stockpiling of goods will be bad.

You are not getting wealthy for nothing, you get wealthy for restraining your consumption, which is major problem of todays world, trust me im homeless(for proof can check me on youtube channel AngriestCat) and amounts of good food i find in supermarket trash is ridiculous.

Re: Why I'm Interested in Bitcoin

#163

Post by XorNot »

PureApeshit wrote: post #162
XorNot wrote: post #156

Earlier quoted context omitted.

Bitcoin being deflationary, the value will never settle. No government wants deflationary money, and you don't either because no one who doesn't have it has any reason to accept permanent servitude from a deflationary currency. Or as I like to put it: why do you think you should get wealthy for doing literally nothing? Not investing, not loading, not accepting any risk, not working?

computer power is deflationary, tablet i bought for 200 euros 2 years ago, oday i can buy same specs for 59 euros... still noone waits and holds till stuff get cheaper, same with bitcoin it will only help environment for massive stockpiling of goods will be bad. You are not getting wealthy for nothing, you get wealthy for restraining your consumption, which is major problem of todays world, trust me im homeless(for p…

The computer you bought 2 years ago didn't increase in computing power in that time. A computer from 2 years ago is not worth more today.

But wealth in a deflationary currency does.

The rest of your argument about curtailing consumption is an irrelevant tangent here.

Re: Why I'm Interested in Bitcoin

#164

Post by aggronn »

natrius wrote: post #87
aggronn wrote: post #77

Earlier quoted context omitted.

Regardless of what any armchair economist thinks about the federal reserve, how can you love bitcoin as a currency if you think that the fed 'plays an important function'?

I think the Fed plays an important function, but I also think that paper money won out over gold only because it was much easier to spend and verify. Otherwise, gold's track record as a store of value is clearly better. I think Bitcoin could outcompete the dollar, and if it does, central banking will end regardless of how I feel about it.

There is a third possibility: central banks come up with their own alternative to bitcoin.

Re: Why I'm Interested in Bitcoin

#165

Post by saalweachter »

patio11 wrote: post #152
saalweachter wrote: post #145

Earlier quoted context omitted.

Actually, where are all of these numbers coming from in the first place? I know I've heard a lot about the "credit card tax", but I can't seem to pull the numbers off the public data on these companies. Visa has $10.4 billion in revenue off of processing $4.4 trillion in transactions; that seems to make the credit card tax a mere 0.2%, which is off by an order of magnitude from the conventional-wisdom "credit card ta…

Visa is not the only party receiving money on the transaction: the processor/merchant bank and issuing bank also both receive cuts which dwarf Visa's.

Hmmm, that is definitely a part of the mystery.

According to their annual reports, Chase, Bank of America, Citicorp, and Wells Fargo had a combined $15.3 billion in card services revenue/card fees.

If you add that to the $7.4 billion in revenue from Mastercard, $10.4 billion in revenue from Visa, and $27 billion in non-interest revenue from American Express (of which $17 billion was "discount fees", which I think means cash-back), you're up to $60 billion dollars.

I feel comfortable going from $60 billion to $100 billion just extrapolating from the top companies to the rest of the industry.

Any guesses on where the extra $400 billion is going?

Re: Why I'm Interested in Bitcoin

#166

Post by nicholas73 »

grovulent wrote: post #157
nicholas73 wrote: post #37

I don't think Bitcoin will ever be a viable currency, at least not on the scale of national currencies. Despite all the flaws fiat currency has, it is actually backed by something - the power of the country's government to tax. Thus, any buyer of sovereign debt has a calculable probability of return. Despite America's printing of dollars, inflation has actually been mild so far. Bitcoin has nothing backing it but an…

Folks make this statement: "but a currency must have backing, or intrinsic value" and feel that they have just proved bitcoin can't work. But not many contributors seem capable of stating WHY they believe this. Care to elaborate? In any case, I think it's entirely possible that you're wrong, and I've written a long argument against your claim if you're interested: http://reviewsindepth.com/2013/12/bitcoin-krugman-and…

There are two things a currency needs - wide acceptance and store of value. Your point about agreement can solve acceptance, maybe, if there is enough impetus to switch (like a failing dollar).

However as it store of value it fails because people holding currency do not want volatility. Dollars are created in response to increase in goods; bitcoins are created by algorithmic mining. There is a disconnect in creation vs. supply of real goods, therefore the value of bitcoin will fluctuate more. You might say that bitcoin's positive value increase bias makes people desire it over dollars, but that would cause people to hoard bitcoins only to dump and crash the market.

Now, you can adjust bitcoin by CPI, but then you'd just transform bitcoin into a system just like other currencies, along with entrusting a central banker and other problems.

The transactional advantage seems nice, but there is no reason a system can't be set up for dollars either.

I'm not going to say it's never going to happen, but it seems unneeded at this point.

Re: Why I'm Interested in Bitcoin

#167

Post by nicholas73 »

grovulent wrote: post #157
nicholas73 wrote: post #37

I don't think Bitcoin will ever be a viable currency, at least not on the scale of national currencies. Despite all the flaws fiat currency has, it is actually backed by something - the power of the country's government to tax. Thus, any buyer of sovereign debt has a calculable probability of return. Despite America's printing of dollars, inflation has actually been mild so far. Bitcoin has nothing backing it but an…

Folks make this statement: "but a currency must have backing, or intrinsic value" and feel that they have just proved bitcoin can't work. But not many contributors seem capable of stating WHY they believe this. Care to elaborate? In any case, I think it's entirely possible that you're wrong, and I've written a long argument against your claim if you're interested: http://reviewsindepth.com/2013/12/bitcoin-krugman-and…

Another point is to look at the position of sovereign wealth, large banks, and investment funds. If you held a trillion dollars, would you park it in a currency that is backed by a state, or trust that kind of money with mere agreement? Would you put most of your net worth in bitcoin?

Now let's allow that bitcoin has become universally accepted and is indexed to some basket of goods. Then it should be reliable as a currency, right? Well, yes, it'll be an international currency ... just like the Euro! And what we saw in the last few years is that the Euro system is inherently unstable because of unbalanced trade and uncontrolled government debt. You have the PIIGS countries facing the choice of massive debt service or withdrawing from the currency altogether. You have the wealthier countries being forced to support the deadbeats from their own tax base.

In the end, currency is what people make it out to be, and people will game the system. Whatever system bitcoin settled upon will have its own problems. At least with a state backed system you have players who have self interest in mind.

Re: Why I'm Interested in Bitcoin

#168

Post by abalone »

XorNot wrote: post #160
abalone wrote: post #158

Earlier quoted context omitted.

You might consider that the reason staff don't realize you can tap is that nobody uses it, because you can just swipe without a PIN for small purchases. I am not saying this is superior, just observing an example of how even changing consumer behavior is difficult when the value add is minor.

No in this case it's because they don't present the reader to you - they punch in the sale, then ask you to hand them the card and swipe it. Also in Australia I've not seen swipe without PIN used very much - a swipe usually requires a pin, whereas tap does not (and is also a lot faster).

Australia has different rules. In the US at least, the PIN is not required for small purchases.

It's interesting you mention Australia because they've taken a different approach to the fee issue. They regulated it away. Cards cost merchants very little. Didn't need bitcoin to do it, just passed a law.

Also interesting: it did not result in a lowering of consumer prices. The merchants kept the windfall.

Re: Why I'm Interested in Bitcoin

#169

Post by pfisch »

XorNot wrote: post #154
pfisch wrote: post #140

Earlier quoted context omitted.

It seems like you need a new security system to reduce fraud which will reduce fees, and that is what bitcoin offers potentially

Yeah that must be why people aren't losing Bitcoin and having it stolen every second week...

That has nothing to do with the security mechanisms around bitcoin and everything to do with noobs and the infancy of the technology.

Re: Why I'm Interested in Bitcoin

#170

Post by XorNot »

pfisch wrote: post #169
XorNot wrote: post #154

Earlier quoted context omitted.

Yeah that must be why people aren't losing Bitcoin and having it stolen every second week...

That has nothing to do with the security mechanisms around bitcoin and everything to do with noobs and the infancy of the technology.

It has quite a bit to do with the security mechanisms around Bitcoin, when compared to the security mechanisms around modern transaction processing.

Bitcoin advocates like to bang on about hyperinflation which isn't happening, meanwhile they're being robbed blind.

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