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Why I’m Putting All My Savings Into Bitcoin

falkvinge.net

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Re: Why I’m Putting All My Savings Into Bitcoin

#41

Post by aaa1 »

woodall wrote: post #33
scotty79 wrote: post #12

Earlier quoted context omitted.

If such silly thing as gold became money and paper printed by governments became money then a tool possessing qualities that bitcoin possess is bound to become money eventually. Only two real risks. Crypto weakness or Bitcoin 2.0 Gold is intrinsically similarly useless as bitcoin. We used it as money only because it was durable and rare. We used paper as money because strong, trustworthy entity declared that its supp…

>Gold is intrinsically similarly useless as bitcoin. That is incorrect on many levels. Gold has applications in MANY things. I bet the device you used to type out that comment has a bit of gold in it. The comparison to BitCoin and paper money makes more sense, but it doesn't. This is because BitCoin has no one backing it. If the dollar drops, well the US is backing it; and they will be forced to deal with the consequ…

>If the dollar drops, well the US is backing it; and they will be forced to deal with the consequences.

http://en.wikipedia.org/wiki/Hyperinflation

Currencies made by governments routinely lose >99% of value in few weeks. How this "backing" helps if you lose everything? In my country it happened 15-20 years ago.

Also even US dollar drops every year.

Re: Why I’m Putting All My Savings Into Bitcoin

#42

Post by Tichy »

vaksel wrote: post #4

I recommend reading up on the MMM company. http://en.wikipedia.org/wiki/MMM_%28Ponzi_scheme_company%29 there is also a Russian movie called PiraMMMida that came out a few months ago, which is the fictionized version of history. Now that movie, is pretty much exactly how bitcoin tends to be covered by the fanboys. And as the movie points out, it comes down to pure greed, people give up real money in order to buy worth…

BitCoin doesn't promise any returns, and doesn't distribute anything to new people who sign up. It is only a Ponzi scheme if the real world's economy is a Ponzi scheme. I don't know if it is.

Re: Why I’m Putting All My Savings Into Bitcoin

#43

Post by knowtheory »

luigi wrote: post #3

This violates two simple, and obvious, tenets of investing: 1. Don't put all your eggs in one basket. 2. If it sounds too good to be true, it probably is.

Actually Luigi, you're missing the best and most fundamental rule:

3. Past performance is no guarantee of future returns

Re: Why I’m Putting All My Savings Into Bitcoin

#44

Post by woodall »

BCM43 wrote: post #36
woodall wrote: post #33

Earlier quoted context omitted.

>Gold is intrinsically similarly useless as bitcoin. That is incorrect on many levels. Gold has applications in MANY things. I bet the device you used to type out that comment has a bit of gold in it. The comparison to BitCoin and paper money makes more sense, but it doesn't. This is because BitCoin has no one backing it. If the dollar drops, well the US is backing it; and they will be forced to deal with the consequ…

> If someone pulls the rug out on BitCoin- might never happen, but who knows- then no one is responsible. How might someone go about doing this?

I'm not that intelligent, but a few folks on the BC forums and other places have brought up some great points:

1. Government shutdown

2. BitCoins P2P network is very vulnerable to denial of service attacks; ones that actually cost money!

3. Public Node can be tracked; no more anonymity.

4. Technical merits of the crypto implementation have not been fully tested; is there a possible flaw?

5. Social engineering and one-time inflation.

6. Unreliable and opaque banking organizations; no one is backing it.

There are many more, and they could all be fixed if bit coin was a centralized currency system, but it is not. It is too soon to say "BitCoin is ridiculous and will never work", but someone with a motive and means can definitely make a miners life hell.

https://en.bitcoin.it/wiki/Weaknesses http://forums.xkcd.com/viewtopic.php?f=8&t=69178

Here are some things BC has going for it though!

1. Distributed with no single point of failure.

2. No "mint"; could be a bad thing.

3. No individual company can be arrested and shut down.

4. "Anonymity"

Re: Why I’m Putting All My Savings Into Bitcoin

#46

Post by ZeroMinx »

Let's be clear that this is Rick Falkvinge, founder of the first Pirate Party. His title is now "political evangelist". It's not surprising that he's in favour of a currency that is free from government control.

(Not that I disagree with him in general, I just thought this is something to take into account reading this article)

Re: Why I’m Putting All My Savings Into Bitcoin

#47

Post by po »

henrikschroder wrote: post #31
carbocation wrote: post #16

Earlier quoted context omitted.

Leveraged positions are common, but leveraging yourself to the maximum possible and not leaving yourself a safety net, as is implied by the article, is crazy. I assume the author is speaking hyperbolically.

Knowing Rick, this is exactly the kind of thing he would do. You gotta give him credit for putting money where his mouth is, though. He previously took all his savings, and a bank loan to start the Pirate Party, and that worked out pretty well.

There's nothing more dangerous than a confidant gambler. Taking one high risk may wipe you out or make you rich, but taking a series of high risks will almost certainly wipe you out. His past success has nothing to do with this wager he's making now. It's like playing russian roulette 10 times in a row.

Re: Why I’m Putting All My Savings Into Bitcoin

#48

Post by premchai21 »

Tichy wrote: post #42
vaksel wrote: post #4

I recommend reading up on the MMM company. http://en.wikipedia.org/wiki/MMM_%28Ponzi_scheme_company%29 there is also a Russian movie called PiraMMMida that came out a few months ago, which is the fictionized version of history. Now that movie, is pretty much exactly how bitcoin tends to be covered by the fanboys. And as the movie points out, it comes down to pure greed, people give up real money in order to buy worth…

BitCoin doesn't promise any returns, and doesn't distribute anything to new people who sign up. It is only a Ponzi scheme if the real world's economy is a Ponzi scheme. I don't know if it is.

Actually, while the Bitcoin system itself does not arbitrarily distribute any money to new clients, there does exist a Bitcoin Faucet[1] to help newcomers try the system out, allowing various people to acquire a few free cBTC once.

[1] http://freebitcoins.appspot.com/

Re: Why I’m Putting All My Savings Into Bitcoin

#49

Post by Duff »

"They built a house of straw. The thundering machines sputtered and stopped. Their leaders talked and talked and talked. But nothing could stem the avalanche. Their world crumbled. The cities exploded. A whirlwind of looting, a firestorm of fear. Men began to feed on men. On the roads it was a white line nightmare. Only those mobile enough to scavenge, brutal enough to pillage would survive. The gangs took over the highways, ready to wage war for a tank of juice. And in this maelstrom of decay, ordinary men were battered and smashed. Except for one man armed with an AK-47, and a Honda full of silver"

Re: Why I’m Putting All My Savings Into Bitcoin

#50

Post by woodall »

oliveoil wrote: post #39
woodall wrote: post #33

Earlier quoted context omitted.

>Gold is intrinsically similarly useless as bitcoin. That is incorrect on many levels. Gold has applications in MANY things. I bet the device you used to type out that comment has a bit of gold in it. The comparison to BitCoin and paper money makes more sense, but it doesn't. This is because BitCoin has no one backing it. If the dollar drops, well the US is backing it; and they will be forced to deal with the consequ…

> Such rapid inflation will not go on forever. Isn't it deflation if you can buy more with the same amount of the currency?

Corrected. Sorry about that.
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