Online Cash Bitcoin could Challenge Governments, Banks • Hacker News Board

Re: Online Cash Bitcoin could Challenge Governments, Banks

#51

Post by weavejester » Sat, Apr 16, 2011, 5:59 PM UTC

pnathan wrote: post #16

Bitcoin is really cool. I just wish I knew what to sell to get some. My dabbling with mining bitcoins has convinced me it requires a on-all-the-time setup to mine with any prayer of success. Last time I looked, there didn't seem to be a real economy, just people trading bitcoins. ~.~

You can buy bitcoins via Paypal if you want: http://coinpal.ndrix.com/

There's a lot of trading of fiat currencies against bitcoins. I suspect that the most often bought and sold commodity is the US dollar.

Re: Online Cash Bitcoin could Challenge Governments, Banks

#52

Post by pyrhho » Sat, Apr 16, 2011, 5:59 PM UTC

Duff wrote: post #22

weavejester wrote: post #5

Earlier quoted context omitted.

There are lots of examples of governments or large organisations taking down networks with single points of failure, but far fewer examples of taking down highly distributed networks like Bitcoin. I don't think this fight is a foregone conclusion. I think it would be difficult to write a law that would make Bitcoin illegal, without making things like MMO currencies or SSL certificates illegal.

From a practical standpoint, Bitcoin has other problems for using it in a real business -- mainly the fact that taxes are only payable in the coin of the realm. If you are a real, legal business, do you want your entire personal and business future contingent on the ability to exchange bitcoin with dollars?

From a practical standpoint, the Dollar has other problems for using it in a real business -- mainly the fact that it is controlled by a centralized, and potentially incompetent, bureaucracy.

If you are a real, legal business, do you want your entire personal and business future contingent on the ability to exchange dollars with goods and services?

Re: Online Cash Bitcoin could Challenge Governments, Banks

#53

Post by joeyh » Sat, Apr 16, 2011, 6:01 PM UTC

AndrewMoffat wrote: post #28

Why is Bitcoin a good currency again? If I understand how it is distributed correctly, those with higher/more computational power receive more of the finite bitcoins. How does that not favor the already rich?

The number of bitcoins produced in a given time interval is kept close to constant, based on the quantity of resources used to produce them in the recent past. So throwing vast resources at mining should be conterproductive.

Serious miners use GPU hardware, so there are effectively two tiers of miners: Those who have a GPU and can dedicate it to bitcoin, and those who don't.

Re: Online Cash Bitcoin could Challenge Governments, Banks

#54

Post by quanticle » Sat, Apr 16, 2011, 6:02 PM UTC

jsavimbi wrote: post #24

vessenes wrote: post #12

Earlier quoted context omitted.

There are many, many bitcoin speculators. I know because I was one, sort of. Large bitcoin holders currently have in excess of $250k in BTC value, much of it purchased at $.02/BTC -$.05/BTC originally. There are a few people making their daily living trading, generating and exchanging BitCoins. Just the top of the iceberg, I imagine. The payment problems are exactly as you describe. Interestingly, it would definitely…

You don't need a US-based exchange for BTC, per se, as other currencies are traded on the open market and the brokers simply relay quotes to their customers via feeds they receive rom the banks. If the banks saw the potential to make money off of trading BTC, they'd make it happen.

You don't need a US based exchange, but changing bitcoin into a foreign currency and then turning that foreign currency into dollars would probably incur enough in transaction fees to be unprofitable, especially if you're changing large amounts of currency on a regular basis.

Re: Online Cash Bitcoin could Challenge Governments, Banks

#55

Post by CoffeeDregs » Sat, Apr 16, 2011, 6:05 PM UTC

tybris wrote: post #41

AndrewMoffat wrote: post #28

Why is Bitcoin a good currency again? If I understand how it is distributed correctly, those with higher/more computational power receive more of the finite bitcoins. How does that not favor the already rich?

Traditional currency is still too reliable because it is tricky to get a critical mass to give up their faith in government and the economic system. For these boom and bust times we need something that can become completely worthless overnight when someone finds a new mathematical technique, flaw in the BitCoin implementation, or lucrative exchange scheme.

>it is tricky to get a critical mass to give up their faith in government and the economic system

Why would you have to do that in order to use BitCoin? I've used all kinds of currencies/monies (including trading, labor, whatever) in my life without giving up faith in the US Govt's ability to back the dollar.

Re: Online Cash Bitcoin could Challenge Governments, Banks

#56

Post by StavrosK » Sat, Apr 16, 2011, 6:06 PM UTC

phillmv wrote: post #48

quanticle wrote: post #42

Earlier quoted context omitted.

Currencies linked to physical goods of limited quantities wouldn't inflate. For example, I could make a currency that represented shares of Picasso paintings. Since there are only a limited number of Picasso paintings, my currency wouldn't inflate. Commodity-linked currencies (e.g. those that are gold/silver based) don't inflate much in a practical sense, since the amount of gold/silver being mined each year is usual…

Hrm. My understanding is that inflation can affect anything we attach value to (and that broadly speaking "value" is also an abstract concept). Suppose the price of oil (or any other primary resource) jumps 50%, increasing the nominal cost of everything that has been made from it. Your gold backed dollar now can be exchanged for less things than before, irrespective of the total supply of gold in the world. Does that…

That's not inflation, though, that's just a price change...

Re: Online Cash Bitcoin could Challenge Governments, Banks

#57

Post by clistctrl » Sat, Apr 16, 2011, 6:07 PM UTC

StavrosK wrote: post #40

clistctrl wrote: post #38

Bitcoin is pretty sweet, but its extremely confusing. I barely understand it, and i'm an extremely technical user. I think people need to work harder on bringing down the complexity.

What complexity? The client pretty much only has one button, "send BitCoins".

How do I transfer my coins from one computer to another? I found digging through my application data to find the wallet.dat file is unintuitive.. along those same lines, how many less technical users have lost extremely important data because they never made a backup? Additionally what if I want one wallet so I can go to a physical store, and use my phone to pay? The shuffle seems very inefficient to me. Perhaps people could setup servers to host their own wallet... however that creates another barrier of entry to less technical users.

Look at this crazy shit: http://www.stronggames.com/bitcoin if I want to buy a game I have to somehow obtain 40 bitcoins (the markets are great for speculators, but its not 2 buttons simple for people who just want some coin) after I somehow obtain the bitcoins I need to tell them about it...

In the form that it is in today, this is a currency for geeks. Awesome? (hell yeah!) but sometimes you need to do business with non geeks, and its just not ready yet for them.

Re: Online Cash Bitcoin could Challenge Governments, Banks

#58

Post by known » Sat, Apr 16, 2011, 6:16 PM UTC

Sounds like computerized http://en.wikipedia.org/wiki/Hawala

Re: Online Cash Bitcoin could Challenge Governments, Banks

#59

Post by sgornick » Sat, Apr 16, 2011, 6:18 PM UTC

clistctrl wrote: post #57

StavrosK wrote: post #40

Earlier quoted context omitted.

What complexity? The client pretty much only has one button, "send BitCoins".

How do I transfer my coins from one computer to another? I found digging through my application data to find the wallet.dat file is unintuitive.. along those same lines, how many less technical users have lost extremely important data because they never made a backup? Additionally what if I want one wallet so I can go to a physical store, and use my phone to pay? The shuffle seems very inefficient to me. Perhaps peop…

Baby steps.

Try starting out using an eWallet, such as MyBitcoin: http://www.mybitcoin.com

Then buy your Bitcoins with PayPal here: http://coinpal.ndrix.com use the bitcoin address generated at MyBitcoin. You'll get your bitcoins in less than an hour at MyBitcoin.

Then those bitcoins can be spent using your example, at StrongGames.

Re: Online Cash Bitcoin could Challenge Governments, Banks

#60

Post by known » Sat, Apr 16, 2011, 6:18 PM UTC

clistctrl wrote: post #38

Bitcoin is pretty sweet, but its extremely confusing. I barely understand it, and i'm an extremely technical user. I think people need to work harder on bringing down the complexity.

http://www.mtgox.com/