Topic: Bitcoins are most like shares of common stock (Read 15087 times)

Seconded with a smile!

Bitcoins have no dividend or potential future dividend, therefore not like a stock.

More like a collectible or commodity.

I can't imagine that governments would ignore Bitcoin just because it didn't claim to be money.  It's the fact that it can anonymously mediate exchanges (including exchanges with currencies) that makes it a threat.

The solution, IMHO, is careful design and implementation, not semantics (or pleading).

OK, would one of y'all be so kind as to post a forum URL for the prior proposal?

Re anonymity, many Bitcoin users seem far too unconcerned, IMHO.

Yes, we can in theory. But do we have the organization to defend our terms? Do we even agree on what those terms might be?

We have anonymity, and we're below their radar at the moment. But that will change as soon as they see us as a threat. If you haven't seen the wheels of justice grinding in all their hypocritical glory, you are ripe for an amazement. Any appeals to "fairness" are going to get you slapped down hard.

I say the best way not to get shot at is to not be a target, and certainly not to donate the ammo. Don't claim to be money. It's that easy.

ichi: Why should I do your work for you? If you want to argue, then bring something to the table.

So, fresno, do you consider "GETS" to be one of "their terms"?

If so, please share your preferred term for Bitcoin.  I have read your comment that you already did, and I'm too lazy to find it.  Please indulge me 

I thought that it proved that we can use whatever words we want and define them however we want and just because 'they' use the word 'dollar' to mean something does not mean we can use a word spelled the same way to mean something completely different.

Has anyone noticed that the FRN is exactly that, "it's own unit for accounting purposes"?

The lawful United States dollar is defined in law as 371 4/16th grains of silver. This has been slightly modified, but never repealed. The "dollar" is actually a unit of measure, you can look it up. Bet they didn't tell you that in school!

The Federal Reserve Note is "denominated in dollars", or as Red above states, they have defined their own unit for accounting purposes. Write the Fed a letter, press them on the subject. The will reply that the FRN is "backed by the full faith and credit of the U.S. government." What they won't admit is that the FRN is NOT a U.S. dollar as defined in law. It is "denominated" as one only because you agree to the terms in commercial contract.

Why did we take this little tour? Because it illustrates that we can define our terms. And that it is foolish to use their terms -- money, cash, dollar, currency, and a crapload of others.

Wow! That is high praise from you Creighto!

I'm willing to start a new thread about it. I'm also willing to contribute to the project. However, by nature I'm very lazy! I often fail to complete projects like this.

However, should my laziness consume things, you've already demonstrated your aptitude for the project. After all, it was your analogy to begin with!

Cheers!

Well done, indeed!  I think that you have nailed it one the head.  A Global Exchange Trading System.  I think that you should write an expanded article along these lines, if you are willing, and post it both on the wiki and wherever else that you would like.  So that we can establish early that Bitcoin is a 'trading system' and *not* a currency (hard or otherwise) and *not* a commodity or intended to be traded  as such.

Are you willing, Red?

I'd like to submit that I think the most apt description of bitcoin is that it is most like a Global Exchange Trading System (GETS) which is a variation on the LETS concept that isn't for hippies.

Descriptively it differs because it's community is loosely knit and global rather than an intertwined small-town. As such, there can be no commonly trusted party to operate and monitor the system, so that function is trusted to redundancy and mathematics. (block list)

LETS communities can rely on "local knowledge" of peoples historical behavior and intentions. As such it is perfectly reasonable for them to advance credit to people (negative balances) in certain situations. In a GETS community advanced knowledge of all parties and intentions is not practical or even preferred. As such, GETS operates on a zero credit policy. (no negative balances)

Also, since GETS trade globally, there is no "national currency" that can be used for equivalence. As such, GETS defines it's own unit for accounting purposes. Since this currency must necessarily vary against some national currencies, the LETS strict "no interest" principle cannot be preserved.

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I think if people understood LETS they would intuitively understand GETS. The rest of the bitcoin details are just one possible GETS monetary policy.

You could trade beans for marbles or baseball cards, but they would be totally independent of the bean thing, right?

Bingo! I've been following this thread and others thinking to myself "why the money obsession?". Even those that argue on different economic philosophies compare to money, use money, use the lack of money, money, money, money...

I compare Bitcoins to beans... when we played cards as kids we used beans as measure of wins / losses. We didn't trade it for money, we didn't play for "make believe money", we played for beans. It worked because we all agreed that beans where the game measure, and because there was a limited supply of them (in our game table, that is).

If we had some special engineered beans instead of Bitcoins, that took a full hour to produce a batch and for some quantic weirdness could only be produced one batch at a time in the whole universe, but anyone could try and grow them, we could use those instead of BTCs, with the obvious caveat of not being virtual, of course... They wouldn't be money, they would pretty much not have any value except for what you and your peers agree it had. It's the same. If I think you whispering 545 decimals from pi to my ear is worth me giving you a deed to my house, does that make pi, or it's value, a currency?

"the US FRN is akin to a national stock with a reverse dividend,.." ROTFLOL!

I challenge this group to think simple!

Bitcoin is something we use, but Bitcoin is not the use! It is simply a machine. Don't give it names it doesn't deserve.

Just for reference:

Market capitalization/capitalisation (often market cap) is a measurement of size of a business enterprise (corporation) equal to the share price times the number of shares outstanding (shares that have been authorized, issued, and purchased by investors) of a public company.

I don't think the un-generated shares would be counted. They would be authorized shares, but they have not been issued through their IPO phase yet.

That's right. It is under 21M because amounts less than .00000001 get rounded away.

Isn't the limit just shy of 21,000,000 possible BTC?

$0.06 per BTC   * 23,000,000 total potential shares = $1.38M market cap.   Most shares are held by the "corporation" which is exchanging them for processing power over time.   

This is just one way of looking at the coins.   I contend that if some rich dude held 95% of all gold and he was selling gold for processing time at a fixed rate that it would not be considered monetary inflation any more than an individual with 1% of all gold in saving deciding to spend it.   The fact that this "rich dude" is the the bitcoin algorithm does not change the fact that there are only 23,000,000 possible BTC.

   

Edited above and reposted so you don't have to look up.

I really wanted pride of place on this one.

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It is very important to any new venture to NOT define it in terms of a well known scam. No one here would say bitcoin is like a Ponzi scheme except without the scam part.

But that is what you are doing by saying, it's like issuing stock in a corporation, except without all that bother of actually creating a product. Let's just consider the stock the product and get right to selling it! It's a limited edition product, so its price will vary based upon supply and demand.

Trust me, that metaphor has been used for thousands of scams. It is equivalent to a "red flag" warning to all authorities.

You are really much better saying bitcoins are like sets of collectable poker chips. Some people will want them, some will not. If lots of people want them you can sell each poker chip separately.

Yeah, I don't know where he got that from.

3.75M BTC have been "released" The "marginal bitcoin" is trading for about 7 cents right now. I don't really know if it's useful to multiply those numbers together, but if you do you don't get $1.38M anyway.

This is not quite right either, I think.  However, I have heard the explaination that the US FRN is akin to a national stock with a reverse dividend, so if this manner of thinking about it helps some people wrap their heads around it, then I won't object.  That is, other than to say that this is an analogy only.

Personally, I don't think that there is anything we really can compare Bitcoins to that anyone really would have any prior experience with.  Bitcoin is something altogether new in the realm of trade.  It is a solution to a set of problems, and (potentially) serves as a solution well.  I don't, personally, think that it's a good idea to compare Bitcoin to *anything*.  Expecially since most people, including most people that seem to post often on this forum, lack a true understanding of what these other comparitive things are.  The best thing to say to describe Bitcoin is to talk about *Bitcoin*, and accurately describe how the system works as well as what it was designed to accomplish. 


Think about this, children have experience with money very young, but have you ever tried to explain what money actually is to a child?  Complete understanding of a monetary system is not a requirement of it's successful use.