Topic: building up an economy for Bitcoin (Read 1355 times)

There a crucial difference between people from the outside finding an idea stupid.
I don't think anybody consider the owners of MtGox stupid for having started their business. MtGox succeeds at making money with it.

The same goes for silk road.

Miners make enough money to pay their own cost by mining.

Those people aren't stupid, they are smart and do what's economically benefitial for them.
Only if he would find enough customers. Programming is unfortunately no license to print money.
We live in a world where 100ms of additonal ping cost amazon 1% of sales. Making the sales process more complex is very costly for the salesman.
Tragedy of the commons.
For bitcoin to succeed it actually has to be advantagous for the market participants to use bitcoin.

true

According to alot of people, the idea of Bitcoin is also stupid.

About micropayments, I think this is more of a technical issue that the Bitcoin-developers will try to solve.

However, I understand what you mean, that's why I said it is not an easy task. But hey, we must start somewhere. Some companies can do this if they would want to start accepting bitcoins as payment. The problem is most won't, because they don't have to.

I think many will agree with me that the new adopters recently, within one or two months back are speculators, investors, earlier gold-savers, or earlier fiat-currency-savers. Do we have an economy? No.

They key is to introduce new people to Bitcoin, so what I tried to say was:

The programmer that I have in my mind should be the one that already has good amount of bitcoins. Why it is in his interest to drive up the value, in other words to build up this economy.

-To be able to get a software, possible buyers first buy bitcoins with fiat from either people, miners or exchanges (the people that have bitcoins today have already "adopted" it).
-After selling software, programmer sells the bitcoins that he got for his work in the exchanges.
-He can now buy food, clothes.
-He can sell his software one million times right?

A good tactic might could be that the programmer prices his work for example for two currencies,
assume 50$ in USD; 0,1btc. People will catch the idea to get bitcoins since the software is "at the moment" cheaper to buy with bitcoins than USD. At the same time, the ratio of USD/BTC should slowly increase at the exchanges due to higher demand.
This will more or less force people to adopt Bitcoin in a natural way. The people that are in touch with computers everyday will adopt it fast and easily.

One or two pioneers doing this will not change the world. How about 1 000 persons doing this? And later on 100 000 persons? We know that there are some people doing this today, but they are few.

What we need are good products, the products that many desire. Programmers, web designers, web developers, application developers, game developers, graphic designers and many more will fall in this category as the pioneers of Bitcoin economy builders. We must remember where Bitcoin is coming from.

How about merchants that sell physical goods, like food and clothes (no online store)? This category could be more or less the last group to adopt since user-friendliness of Bitcoin is not there yet and the merchants also will have to buy clothes and food with fiat-currencies. As today how Bitcoin works, I think many merchants will just give up.

Last but not least, I would like to see some more and different ideas on building up economy from you guys.

Basically you say that you need people to volunteer to be stupid.

Software programmers need to buy their food in dollars. They most things that they need in dollars. You don't write software to get a currency that you can primarily use to buy other software.

That's not a great way to build a viable economy.

If bitcoin would fulfill the promise of cheap micropayments than you could use it as a payment method within software. If you could run a 10 cent transaction with 0.01 cent transaction cost then you would surely have software that uses it for internal payments.

At the moment Satoshi Dice which uses it for micropayment gets accused of spamming the blockchain.

Thanks for those words. I am totally with you on this. Low fiat-cost for the "makers" is the way to go.

Yea, Bitcoin as a currency must get rid some of the comparing USD-worth like you said. At least we must slowly get Bitcoin out of the USD-worth while speculators always comparing to it. In my opinion that is of course healthy. Speculators do a good job in this too. 

I am more concerned about building up an ecosystem around Bitcoin.
The question is there is any programmer out there who we can write good applications for users around the world and who despite alot of time and sweat takes bitcoins as payment. Volatility of BTC/USD doesn't matter since you value bitcoins, you don't value USD.

Why softwares? The first mass adoption in nature should be the folks who use computer applications daily, who surf the net etc. Thus are those we can easily reach.

Every currency has an exchange rate with every other. People who use both look at the relevant rate frequently, it has nothing to do with being 'real'.

Fixing prices in BTC terms can still be useful though. Some benefits that come to mind:

Users can know how much they need exactly. If a server bill is calculated last second or changes every 10 minutes that can be annoying.
Your shopping cart won't freak out or give a wrong price when Gox data is wrong or unavailable.
It is a built in discount when coins are 'cheap'. Probably bad if your marginal cost has a large fiat denominated component but good for  items with very low marginal cost (music, software, virtual game objects, entry to a movie theater).

Yea, we can start here

unstable bitcoin => commerce => stable bitcoin

You can earn bitcoins in several ways. One way to do that is to develop things like softwares that you like and that you can give to others and they give you bitcoins, which I wrote in op. Maybe it was not very clear.
 

Its a good sentiment..but impossible until the volatility smooths out.  When will Bitcoin adoption as a currency be widespread? When it retains some sort of stable value, or at least a value with smooth moves up or down over reasonable time periods.   That when....PERIOD!

My thought exactly. Bitcoin will never be a currency on his own, if we keep looking to its USD worth.

On the other hand, I find very unlikely that the idea can be widely adopted. Maybe if we got rid of most overexcited speculators, it might become reasonable...

How can I earn Bitcoins? At least mBTC? I've seen sites which let us earn uBTC but how can we earn mBTC? Do you mean a software store? A subscription model? Bounty?

Fixing prices is fixing prices. 

TL;DR


Those who are interested can read further.

First of all, I'll try my best to express my thoughts on this matter. My English is rather poor, so forgive me. My thoughts are very basic I assume.

There are existing posts by users on this forum related to the bitcoin-economy though I am sure I only have read some and not most of them, so forgive me once again. I am nor a computer programmer (still learning) neither an economist.

One can ask himself following questions.
What kind of environment or world is given birth to Bitcoin?
The answer is Bitcoin was born in the world of softwares. Therefore I suggest, we must tackling this in a software-way besides setting up stores, exchanges, markets.

My idea here is to take a step further in building up economy. Software-developers (programmers) on this forum that support Bitcoin develop softwares and sell them for fixed in price of bitcoins. The softwares are games, applications and so on.
From reading on this forum tells me there are plenty of good programmers out there. We need volunteering programmers to accept payment only in bitcoin and not in any other fiat-currency.
The pricing might be change once in two or three months for example. So your softwares will directly compete with other's who sell their for fiat-currencies.
 
So why fixed price in bitcoins? Up to now we have some stores etc., where you can buy things over Internet with your bitcoins, which is great. Pricing is in USD, how much you pay in bitcoins will vary from day to day which is based on buy/sell of exchanges. I understand why almost all (or all?) markets, stores must do that way. It's about money and living, they have to care about their money, and in their right doing so.

The fixed price of a software/btc will strengthen Bitcoin even more. It will mentally enlightening the existence of Bitcoin and how it is related to the outer world which is important for mainstream.

The chance to change this in a good way I think lies in the hands of software-guys. I know it will be a tough task and will require alot of time, programming knowledge and sacrifice to make this real.
At the moment, I think you guys compare to other groups have the best possibility to do this.

just some thoughts