Topic: Bitcoin will never be as good as gold and why ultimatly it will fail. - page 3. (Read 9417 times)
June 08, 2011, 06:48:16 PM
It doesn't matter if it's electronic. It will be worth as much as anyone is willing to pay for it, just like everything else on the market. Gold is only worth as much as anyone wants to pay for it. If everyone takes a disliking to Gold, it will crash and burn.
June 08, 2011, 06:45:49 PM
http://i.ytimg.com/vi/Z454M2uBBxA/0.jpg
I thought that is a funny picture in relation to bitcoins, I know it's not the same thing, but 'kidds' are mining a type of electronic currency.
Why hasn't anyone addressed the issues I raised? nobody has refuted anything, some of the replies appear that some of the posters have not read anything I have written like the first poster who just blurted out that it is far too early to sell at $30 and a recent poster here simply showed annoyance and and suggested that a subforum be created for those who wish to post information on why bitcoin will fail.
Is everyone trying to 'keep the faith'?
I thought that is a funny picture in relation to bitcoins, I know it's not the same thing, but 'kidds' are mining a type of electronic currency.
Why hasn't anyone addressed the issues I raised? nobody has refuted anything, some of the replies appear that some of the posters have not read anything I have written like the first poster who just blurted out that it is far too early to sell at $30 and a recent poster here simply showed annoyance and and suggested that a subforum be created for those who wish to post information on why bitcoin will fail.
Is everyone trying to 'keep the faith'?
June 08, 2011, 06:38:30 PM
I propose new dedicated subforum inside "Economy": "Why I think it's gonna fail", that would make reading forum much easier.
Or maybe a forum like my little ponies called "My first post" for those whose first contribution is the same grandiose sounding doom and gloom analysis post.
June 08, 2011, 06:33:55 PM
I propose new dedicated subforum inside "Economy": "Why I think it's gonna fail", that would make reading forum much easier.
June 08, 2011, 06:21:36 PM
Generally the type of deflation people fear today is the result from banks using a factional reserve system, lending out more money than what they have in deposits. With bitcoin this is not possible. Excessive debt can not build up in a P2P currency. When america was on a real gold standard before the 1913 federal reserve act, prices in terms of gold had been deflating in value to gold for hundreds of years.
jon_smark, it would be correct to say that everything has already been deflating in value in relation to bitcoins. A bitcoin was worth less than $1 afew months ago. This is not a problem because banks have not created extra bitcoins and loaned them out into circulation. There is no debt attached to bitcoins so nobody has any problem defaulting on loans because the value of bitcoins have gone up in value. That is why fiat currency keeps dropping in value so as to make it easier to pay back the money to banks and also provide incentive for borrowers to borrow money, most people expect money to keep falling in value, otherwise they would not take out loans.
jon_smark, it would be correct to say that everything has already been deflating in value in relation to bitcoins. A bitcoin was worth less than $1 afew months ago. This is not a problem because banks have not created extra bitcoins and loaned them out into circulation. There is no debt attached to bitcoins so nobody has any problem defaulting on loans because the value of bitcoins have gone up in value. That is why fiat currency keeps dropping in value so as to make it easier to pay back the money to banks and also provide incentive for borrowers to borrow money, most people expect money to keep falling in value, otherwise they would not take out loans.
June 08, 2011, 06:09:01 PM
I do agree that Bitcoin's ultimate demise will not come at the hands of The Powers That Be™, but instead from a new upstart P2P digital currency. However, I disagree that this new currency will follow Bitcoin's model of having a hard-cap on the total number of coins. Instead, the new currency may be virtually identical to Bitcoin, but with one tiny exception: it will have an inflation rate that asymptotically approaches a very small but positive number. In fact, Bitcoin's very likely failure will help to establish the 1st rule of digital P2P currencies: builtin deflation leads to the formation of bubbles, hoarding, and eventual collapse.
June 08, 2011, 05:40:29 PM
If many FIAT currencies can peacefully coexist, why couldn't many p2p currencies? All metals, while not exactly the same, do compete as commodities.
June 08, 2011, 05:39:58 PM
Oh no, I didn't realize other people could also make p2p currencies! Why has there never been a thread about this before!? I'm trading in all my bitcoins for carrots as I write this.
June 08, 2011, 05:36:48 PM
Selling them at $30 would be foolish and way too early. Bitcoin is only just starting to emerge and will continue to rise in price for as long as people have interest in it.
June 08, 2011, 05:28:22 PM
I will explain why the value of bitcoins will fall, the current market price of them is a joke but not from the reasoning people are using on the forums which is faulty. I will explain this below
There is only so much gold in the world, still alot of it has not been mined and will beable to be mined in the future. As for physical currency, out of all the elements, gold is the most desirable followed second by silver. Gold can't be diluted in value, ie a second identical currency coming being different in name only but having all the same properites of gold. Imagine another element that was the same as gold was found, and was able to be found in the same quanities of gold but it had a different color, say light green color and it was called gold2. Half the people began using gold2 in the same way as gold1 is being used. the value of gold1 would be cut in half with the new currency being put into circulation competing parallel with each other. Ofcourse this will never happen, there is no such thing as gold2.
Unfortunately this is not the case with bitcoin. Yes bitcoin is restricted to the total amount of bitcoins that will be found which is 21 million. Unfortunately it is a P2P currency and with the success of bitcoin, other identical P2P currencies will come into existence and the same problem will arise as in the case of gold1 and gold2. With P2P currency, the amount of different named P2P currency will expand. A second P2P currency will come along using the same source code as bitcoin or slightly different but essentially the same. We will call this second currency bytecoin, it has all the same properties as bitcoin as in only being limited in supply to 21 million bytecoins. People with mining rigs will stop mining bitcoins and begin mining bytecoins as it is just starting out, the hash sizes will be smaller and easier to generate more bytecoins than bitcoins. Soon the number of bytecoins in existence will be similar to bitcoins. Half of the people using bitcoins and the other half using bytecoins, also the value of the two P2P currencies is the same because roughly the same number of each are in existence but the orginal bitcoin would be cut in half.
There is incentive for people to move to the new P2P currency as in the early stages it is more profitable to generate P2P currency and as you have seen in bitcoins, the early adopters made the most money.
This process will continue on indefinitely until all P2P currency is worthless. At the end of P2P currencies life, there could be millions of different competing P2P currencies.
Throughout the ages everyone has been trying to turn everything into gold, Lead into gold, paper money into gold and now electronic bits into gold. P2P currency holds alot of the qualities of gold but competing versions of itself can not be created. P2P is a good way to transfer money, conduct business but not as a means of storing value. If the government made a mandate that only bitcoin was to be the only allowed P2P currency to be used on the internet, then it would become very valuable but that is not the case.
If you have bitcoins, you'd be a fool not to sell them at $30. I have also seen a personal website of someone willing to sell gold for bitcoins!!!! It is crazy. I could be wrong in the short term, but in the longterm I will be proven correct. Ideally hold onto your bitcoins until another type of P2P currency comes into existence and becomes being used in mass, that will be the best time to sell as it is when the value of bitcoin will be at it's highest just before people also begin using the second P2P currency as well.
Hope you found this interesting.
There is only so much gold in the world, still alot of it has not been mined and will beable to be mined in the future. As for physical currency, out of all the elements, gold is the most desirable followed second by silver. Gold can't be diluted in value, ie a second identical currency coming being different in name only but having all the same properites of gold. Imagine another element that was the same as gold was found, and was able to be found in the same quanities of gold but it had a different color, say light green color and it was called gold2. Half the people began using gold2 in the same way as gold1 is being used. the value of gold1 would be cut in half with the new currency being put into circulation competing parallel with each other. Ofcourse this will never happen, there is no such thing as gold2.
Unfortunately this is not the case with bitcoin. Yes bitcoin is restricted to the total amount of bitcoins that will be found which is 21 million. Unfortunately it is a P2P currency and with the success of bitcoin, other identical P2P currencies will come into existence and the same problem will arise as in the case of gold1 and gold2. With P2P currency, the amount of different named P2P currency will expand. A second P2P currency will come along using the same source code as bitcoin or slightly different but essentially the same. We will call this second currency bytecoin, it has all the same properties as bitcoin as in only being limited in supply to 21 million bytecoins. People with mining rigs will stop mining bitcoins and begin mining bytecoins as it is just starting out, the hash sizes will be smaller and easier to generate more bytecoins than bitcoins. Soon the number of bytecoins in existence will be similar to bitcoins. Half of the people using bitcoins and the other half using bytecoins, also the value of the two P2P currencies is the same because roughly the same number of each are in existence but the orginal bitcoin would be cut in half.
There is incentive for people to move to the new P2P currency as in the early stages it is more profitable to generate P2P currency and as you have seen in bitcoins, the early adopters made the most money.
This process will continue on indefinitely until all P2P currency is worthless. At the end of P2P currencies life, there could be millions of different competing P2P currencies.
Throughout the ages everyone has been trying to turn everything into gold, Lead into gold, paper money into gold and now electronic bits into gold. P2P currency holds alot of the qualities of gold but competing versions of itself can not be created. P2P is a good way to transfer money, conduct business but not as a means of storing value. If the government made a mandate that only bitcoin was to be the only allowed P2P currency to be used on the internet, then it would become very valuable but that is not the case.
If you have bitcoins, you'd be a fool not to sell them at $30. I have also seen a personal website of someone willing to sell gold for bitcoins!!!! It is crazy. I could be wrong in the short term, but in the longterm I will be proven correct. Ideally hold onto your bitcoins until another type of P2P currency comes into existence and becomes being used in mass, that will be the best time to sell as it is when the value of bitcoin will be at it's highest just before people also begin using the second P2P currency as well.
Hope you found this interesting.
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