Bitcoin

[Matt3737]

Have you heard of Bitcoin?

http://www.youtube.com/watch?v=Um63OQz3bjo

I thought this was fascinating and exciting when I first heard about it, but then after further reflection I began to believe that it was a very bad idea.

While being decentralized sounds good at first, it sounds even better for those who'd commit fraud, money launder, and black market. You cannot chargeback, difficulty in tracing, and inablity to freeze assets make it, in my opinion, an illegal currency that'd be best utilized in the worst ways.

It's a pyramid scheme that invites people to participate while those aware would be manipulating it to cash out and profit from.

 

[Proletar]

On the other hand, how is Bitcoin worse than paper-money? If there is no way to buy stuff without it being traced, I can't buy any weed. And boy, that sure would suck.

While the black market uses secret ways to exchange money, other ways tend to get traced by states and banks. Why should the police be able to see what I have or haven't bought? And why is the Bitcoin-system bad for me and society just because some illegal transactions tends to happen there?


About the pyramid-scheme thing:

The same goes for any currency. Those aware (states and banks) sells their stock of let's say Euros because they know that it will go down. Take the american dollar for example. Worth 12 of my currency around the millenia, now worth 6-7. In the world of the stock-market, you can speculate in anything. I don't see how extending that speculation to one more virtual currency would be a game-changer.

 

[Matt3737]

That is a good point, because I wasn't entirely sure as to HOW manipulated it might be given that legitimate use would have to potentially be higher than fraudulent abuse for it to be viable.

Given the inablity to chargeback and the anonymous transactions, it is very (extremely) dependent on trust. I can propose a transaction, take your bitcoins in exchange, leave you high and dry, and then there is nothing you can do about it except not to trust me again as I make a new identity and continue on my fraudulent enterprise.

If this is the case though and people drop out of using bitcoin, then I would be unable to exchange my now worthless ill-gotten gains, so there has to be a foundation of legitimate exchange.

The difference between the legal currencies and illegal currency seems to me to be a matter of trust. So as you say, legitimate currecy is manipulated also but still has an enforceable proportion of trust whereas Bitcoin is likely to be too volatile for traditional use.

 

[joal0503]

bitcoin...very little experience...but if you are thorough you can absolutely find reputable people within the community willing to help you out.

there was a time very early on (if memory is working) where people were scamming, theft/fraud, 'mining' or something like that...and of course it definitely has its disadvantages...

but i dunno, i just would say from experience yes theres trust factor, but given you find the right people, its almost comparable to the faith and trust you put into your own bank...and i think we all love our bankers so much...

 

[Ex-User (5841)]

Bitcoin... has its uses, specifically the anonymity factor it provides and less detached manifested valuation.

Case in point: http://en.wikipedia.org/wiki/Silk_Road_(marketplace)

The days of an early investment in the pyramid scheme are over, which allows for informed valuation for those who undertake due diligence. In a sense, it's a currency for the initiated.

ahhh...the silk road...

Never

 

[joal0503]

Bitcoin... has its uses, specifically the anonymity factor it provides and less detached manifested valuation.

Case in point: http://en.wikipedia.org/wiki/Silk_Road_(marketplace)

The days of an early investment in the pyramid scheme are over, which allows for informed valuation for those who undertake due diligence.

ahhh...the silk road...

 

[duke of new york]

I'll just leave this here...
http://bitcoinity.org/markets

 

[Ex-User (5841)]

A quick thread resurrection with some news: The U.S. Federal Reserve recently produced guidelines for regulating decentralized currency.

http://www.zerohedge.com/news/2013-...onsider-virtual-transactions-money-laundering

http://www.salon.com/2013/03/22/a_l...tcoin_meets_big_government/?source=newsletter

Whatcha think? Good or bad news for bitcoin? I for one hope that this official recognition broadens the user base and increases price accordingly . To requote the bitcoin price in real time (it's VERY bubbly atm. Check out the past 30 days.): http://bitcoinity.org/markets

 

[Ex-User (5841)]

Zerohedge: "As BitCoin Touches $400 The Senate Starts Seeking Answers... As Does The Fed"

So while the electronic currency is soaring exponentially as it goes through its appreciation golden age, will the one thing that can finally end the dream of BitCoin holders arrive soon: when the government, and existing monetary authorities, start taking it seriously.

Live price: http://www.bitcoinity.org/markets

 

[Hawkeye]

They're overrated and not as safe as people think they are.

It is not economically worth mining for them any more.

 

[Ex-User (5841)]

They're overrated and not as safe as people think they are.

It is not economically worth mining for them any more.

I'm hesitant to agree with the first one, though my human resources aren't in this medium so I'm also hesitant to debunk it.

And mining becomes more effective as price increases.

I think the current tank stops at around $225 and everything immediately afterward depends on news.

 

[Hawkeye]

I'm hesitant to agree with the first one, though my human resources aren't in this medium so I'm also hesitant to debunk it.

And mining becomes more effective as price increases.

I think the current tank stops at around $225 and everything immediately afterward depends on news.

If I mine for a year, my net profit is -$68

[edit] - I was trigger-happy on the "6" button ^^

 

[Ex-User (5841)]

If I mine for a year, my net profit is -$68

[edit] - I was trigger-happy on the "6" button ^^

It's more than mining pools, bro.

Some chopypasta from Mr. Ruggles, from an hour ago:

"Market cap was recently ~2.6 billion dollars, and at the most recent peak it was ~4 billion. As market cap increases, bigger businesses (like Shopify with its 70,000 online stores!) will start to accept it, and the faster it will spread. However business size is not evenly distributed. There are far more smaller businesses than there are big businesses. So doubling the market cap of bitcoin does something far more than double the number of businesses likely to accept it. This will lead to crazy high adoption rates driving the demand higher because then it will finally be far more practical and easy to use since it will be accepted by more people in more places. I think we are, right now, at the start of the hypergrowth "Take off" section of the S curve adoption for technology."

There are legit security concerns, but they're unlikely. Altruists and selfish individuals coexist in dynamic equilibrium in multiple currency systems in the natural world, but not in single currency systems.

*EDIT: Also, that $68 is in USD. In a place with any amount of green, that's a lot of cash, especially considering the nature of mining pools:

Spoiler

 

[Hawkeye]

That $68 dollars was negative income. ^^

Also, what is the dollar worth in the white areas?


Some Australian is claiming a lot of bitcons have been stolen from him - http://www.bbc.co.uk/news/technology-24871444

 

[Ex-User (5841)]

That $68 dollars was negative income. ^^

Also, what is the dollar worth in the white areas?


Some Australian is claiming a lot of bitcons have been stolen from him - http://www.bbc.co.uk/news/technology-24871444

Whoa whoa whoa. I was wondering why that didn't make sense. Source? What are we referencing here?

And the theft was likely an inside job. I don't see how it couldn't be.

 

[Hawkeye]

I used a bitcoin mining calculator quoting the estimated hash-rate of my rig (something in the region of 530Mh/s). I then subtracted the cost of running the rig throughout the year and ended up with negative income. ^^

 

[Beholder]

Did you take into account the rising price of btc? My 1070 dollar investment more that tripled itself in just a few months...

 

[Beholder]

But anyways...
What do you guys think the future holds for bitcoin? A few options I can think of are:
1) It continues to grow in popularity, becomes regulated and taxed, and starts becoming the main currency of the internet. (obviously if this happens it won't stop there, but I don't want to go too far in speculatons)
2) It gets big enough that it starts to have real influence on the world economy, in which case I see two possible options: a) It becomes HEAVILY regulated, nearly impossible to trade bitcoin through anything resembling the exchanges we have now (mtGox, bitstamp, etc) and accepting payment in bitcoin is legally considered money laundering. Because people have no guarantee they will be able to sell their bitcoins for a recognized currency, its value drops and no one will accept it. The death of bitcoin.
b) Something like the above happens, except that maybe in a few countries (China perhaps?) it doesn't, and it actually becomes more recognized, and then since there is something, no matter how small behind it (the fact that it can be used in China for example) keeps it from dying, and it slowly becomes a part of smaller markets worldwide in an underground fashion. (In which case it will probably slowly but very surely take over more and more markets/create new markets, much the way Pirating does...)

All very speculative, it probably won't closely follow any of those paths, but that's what I can think of now.

What do you guys think?

 

[mindtheplatonicgap]

Bitcoin believer here. I've been following it since early 2011, but have really tuned in since earlier this year.

As a programmable currency it represents the liberation of capital on a global scale: the next internet.

Also, it may bring on the age of autonomous economic entities, allowing, say, driver-less taxis to compete for consumer bids on their smartphones, managing their own financial lives for maximum efficiency, as one possible application.

As computers are empowered to manage their own financial well-being
for maximum self interest and growth, you can even extrapolate this technology to the birth of great advances in A.I. ; cue "The Matrix" type imagery in your head.

Cryptocurrency will be huge. Long live Satoshi Nakamoto.

 

[Ex-User (5841)]

Some chopypasta from Mr. Ruggles, from an hour ago:

"Market cap was recently ~2.6 billion dollars, and at the most recent peak it was ~4 billion. As market cap increases, bigger businesses (like Shopify with its 70,000 online stores!) will start to accept it, and the faster it will spread. However business size is not evenly distributed. There are far more smaller businesses than there are big businesses. So doubling the market cap of bitcoin does something far more than double the number of businesses likely to accept it. This will lead to crazy high adoption rates driving the demand higher because then it will finally be far more practical and easy to use since it will be accepted by more people in more places. I think we are, right now, at the start of the hypergrowth "Take off" section of the S curve adoption for technology."

http://www.bitcoinity.org/markets

What do you guys think the future holds for bitcoin?

I think it continues to grow, suffers a major correction, and stabilizes until businesses actually start adopting it to a degree that matches price and market cap.

Within 2 years it'll be taxed or outlawed.

Within 3-5 years, possibly sooner, regulators will be policing businesses and controlling the types of cryptocurrencies they can accept.

As a programmable currency it represents the liberation of capital on a global scale: the next internet.

Indeed.

But in retrospect... BTC might be the cryptocurrency version of AOL...

 

[mindtheplatonicgap]

I concur with all of the above, excluding this statement:

But in retrospect... BTC might be the cryptocurrency version of AOL...

There are currently around 150 contributors, some of them are Google employees like Mike Hearn, working on improving the BTC protocol around the clock. This number is growing:

https://github.com/bitcoin/bitcoin

The bitcoin network is akin to tcp/ip. It's a fundamental platform to build up from. With first mover advantage; it's over 10 times the size of the runner up (litecoin).

It could fail at some point, but if it doesn't, it seems to me that it will maintain this differential advantage for quite some time.

The most notable moat being all the businesses and platforms being built around it at a rather brisk pace:

[URL="http://www.coindesk.com/"]http://www.coindesk.com/[/URL]

 

[Ex-User (5841)]

There are currently around 150 contributors, some of them are Google employees like Mike Hearn, working on improving the BTC protocol around the clock. This number is growing:

https://github.com/bitcoin/bitcoin

The bitcoin network is akin to tcp/ip. It's a fundamental platform to build up from. With first mover advantage; it's over 10 times the size of the runner up (litecoin).

It could fail at some point, but if it doesn't, it seems to me that it will maintain this differential advantage for quite some time.

The most notable moat being all the businesses and platforms being built around it at a rather brisk pace:

[URL="http://www.coindesk.com/"]http://www.coindesk.com/[/URL]

The thing that expands it.
The thing that makes or breaks it.

Ultimately I think it goes the way of AOL because of the advantage given to early adopters. This is a threat to existing economic structures and prone to being victimized by political correctness. So far BTC lacks the requisite P.R.

(This doesn't mean it's not laying the groundwork for its ultimate successor... And Litecoin et al will also fail. The ultimate successor is probably in the shadows.)

 

[Ex-User (5841)]

Then again, about that P.R. ...:

 

[mindtheplatonicgap]

I noticed that too, Habitat. Bitcoin is beginning to enter mainstream consciousness.

Coinmap.org was around 300 merchants when I first stumbled across it just over a month ago. Now it's approaching 1400.

Originally appealing mostly to libertarians and cyber punks, it could be just a matter of time before Occupy Wall Street activists jump on board. Take a look at the facebook group Vacate Wall Street.

I sense that once this thing takes hold it will be powerful.

Record sales on Bitcoin Black Friday: http://www.washingtonpost.com/blogs/the-switch/wp/2013/12/02/black-friday-set-a-record-for-bitcoin-commerce-bitpay-says/

 

[Ex-User (5841)]

Speaking of Wall Street, here's a major development: http://www.zerohedge.com/news/2013-12-08/bitcoin-derivatives-market-has-arrived

 

[mindtheplatonicgap]

I invite anyone reading this post to spend 10 to 20 hours researching bitcoin. Once you've digested everything, form your own conclusion. Imagine if email IPO'd and you could own a piece of it in 1995.

In my mind the rise of cryptocurrencies is already inevitable.

http://www.coindesk.com/bitcoin-future-paypal-president-david-marcus/

http://money.cnn.com/2013/12/10/technology/bitcoin-currency-fred-wilson/index.html?iid=HP_MPM

 

[mindtheplatonicgap]

Looks like INTPs are well represented in the bitcoin community. According to this poll they're the personality type most likely to become interested:

https://bitcointalk.org/index.php?topic=215232.0

 

[Ex-User (5841)]

Bitcoin crashes after China bans new BTC deposits. PBOC gets DDOSed in retaliation.

So where does it bottom out? I'm thinking the $350 zone, possibly below.

I'm also glad I cashed out most of mine in November.

 

[mindtheplatonicgap]

Note the linear logarithmic exponential price growth Habitat:

 

[Ex-User (5841)]

Note the linear logarithmic exponential price growth Habitat:

Spoiler

Math words!

(What I'm getting from this is that volatility doesn't increase as price increases? (Until the kind folks at companies like JPMorgan gain access to the derivatives market...))

 

[mindtheplatonicgap]

Volatility is decreasing with increasing liquidity; now extrapolate this over the next 5 years, where do you think we'll be? Now check out coinmap.org again. 2255 physical businesses now.

http://www.youtube.com/watch?v=c2CsJ2HMA2I

 

[Hawkeye]

Bitcoin still has a muskiness of Tulipomania.

 

[mindtheplatonicgap]

How many more years of success will need to be added to the 5 year bitcoin phenomenon, which is up infiniti percent from zero, to overcome comparisons to the 2 year tulip bulb bubble?

 

[Hawkeye]

How many more years of success will need to be added to the 5 year bitcoin phenomenon, which is up infiniti percent from zero, to overcome comparisons to the 2 year tulip bulb bubble?

Success is somewhat an over-exaggeration. Less than 4 years ago a pizza cost 10,000 bitcoins.

It's only within the last 3 months that Tulipomania has kicked in...

 

[mindtheplatonicgap]

Zoom out and put your chart into log mode.

edit- Wait what is that? Tulip per bitcoin?

As a fledgling currency with a nearly fixed monetary base, price will necessarily increase as adoption increases. The bitcoin network can't be realistically compared to a commodity that will increase in supply as price increases.

Along its rise, provided there is no technical failure, bitcoin will continue to experience crashes as it has in the past. In terms of percentage deviation, run-ups and corrections have been decreasing; i.e. volatility appears to be decreasing. The log chart shows this.

Come on friends, where are the independent thinkers among us? We have here unfolding before us potentially the most important socio-economic experiment in modern history poised to change the world in incredibly profound ways.

I know I'm not the only one here noticing this.

 

[Vrecknidj]

http://www.pcworld.com/article/2083...ired-bitcoin-alternative-for-normal-folk.html

Meet Coinye West, the Kanye-inspired Bitcoin alternative for normal folk
When Kanye West wrote the lyric, “I’m chilling, trying to stack these millions,” he probably did not mean digital currency. But a new technology might give him pause, or at least have him scratching his head.

In a sign that the frenzy over Bitcoin may have reached a new level of ridiculousness, there is now another phenomenon inspired by it: Coinye West, named after the American hip hop artist.

Bitcoin is a new online technology designed as a currency to enable anonymous transactions over the Internet with little or no fees. Bitcoin mining involves pooling together the resources of computers over a network to solve mathematical problems that, theoretically, generate bitcoins as a reward. The software supporting the system is open source, so it has already spawned a number of alternative forms of the technology, such as Ripple, Litecoin and Colored Coins.

Coinye West, however, might be the first to be modeled after, and take its name from, a celebrity. “We chose Kanye because of his trendsetting abilities and his originality,” the developers of the currency said via email. They declined to identify themselves due to the collaborative and “decentralized” nature of the currency.

West himself was not involved in developing the currency, and he was notified of its existence only via Twitter. But who knows how the artist might respond, given his previous claim that “I am Steve Jobs.”

 

[Hawkeye]

How can they think to get away modelling there coin after a person's image without asking for permission...

The mind boggles.

 

[mindtheplatonicgap]

Doge coin contains more swank per coin and is fully authorized. Such shibe.

 

[Ex-User (5841)]

This is why BTC isn't at threat from most other altcoins:

Coinye pump and dump scam

 

[r4ch3l]

Sewooooooooooo....opinions on this whole ghash.io thing?
That escalated quickly.

Made me re-contemplate the power of greed and denial and question some of my nature's-a-capitalist/accidental-libertarian-via-laziness beliefs.

 

[alludes2profundity4lyfe]

The problem with BTC becoming mainstream is that due to its decentralized nature it depends on a basic proficiency of its users. Established currencies are already too complicated for most people to understand but at least there is an authority, the Federal reserve, which is tasked with the "understanding" part. Not that it does either, lol, but the illusion of comprehension is so very important and thus upheld.

Asking people, who are accustomed and dependent on a fiscal authority, to accept a decentralized currency is approaching the magnitude of asking Believers to adopt atheism. Good luck!

Love the idea of Bitcoin though. I know it seems like a money laundering platform to some but can't it become the reverse? Here my lack of technical knowledge will begin to show but...isn't there a unique sequence to each Bitcoin that theoretically could be traced to, if not the user, at least to the previous transactions, a sort of "history" implied by its specific address?