Topic: Denial - page 3. (Read 7036 times)

He has a point though. Some people don't seem to realize that they have a responsibility to spent a fraction of massive bitcoin holdings if the economy should get booming so there is a overall 50% coins in circulation.

Did you dedicate time and money to Bitcoin before it was worth anything? Would you have done so if you had known about it?


Yes, Bitcoin has an inflationary period, which is public knowledge. It is also known at the inflationary period will slow down, leading to a period of a stable amount of money. Can you think of a better way to initially distribute a digital commodity in a decentralized fashion?


Yes. The total amount of currency and inflation rate - past, present, and future - is known to all.


Monopolizing? Again, why weren't you mining Bitcoins at the beginning? Transparency for the system, not individual accounts. Do you demand to know how much your neighbor has in his bank account?


No it cannot.


I think perhaps you should seek therapy.


You still don't understand what you're talking about when you use the word "deflation".

Here's a hint, there's nothing the early adopters (or we) can do to change the rate that Bitcoin are created.

And this has what to do with a fixed supply of money? Oh, nothing. In fact, I would almost call it an intentional attempt to conflate two very different things to cause obfuscation.


And you don't understand risk. You can say you do and you can repeat the same bullshit every bitcoin supporter around here does, but that doesn't make it true buddy!


Currencies don't create wealth. I'm pretty sure all schools of economics agree on this. Currencies, however, can strongly influence the direction in which wealth moves. Mises has a big problem with inflation because it hurts the middle and lower class. Bitcoin substitutes the government and the wealthy for early adopters; spitting in Mises's face while shaking his hand.


Hundreds of thousands of unspent, hoarded, untraceable coins is transparent? Between 5 and 10 people monopolizing 10-20% of the total amount of coins to EVER BE PRODUCED is transparent? No, I don't believe it's transparent at all and can only be discovered by digging through the block chain and doing some math. Perhaps it is known to you and I who have spent time studying the system, but to someone who knows little about bitcoin? Not a chance. And you will never convince me that this is unintended. Satoshi's anonymity and disappearance. Fuck you Satoshi you fucking scumbag.

BTC would have never gotten anywhere near $35 if the early adopters had just opened the floodgates. If their intention was to create a truly deflationary system, they would have taken their one time profit and have been done with the massive hoarding. But that's not what they did.

http://www.newscientist.com/blogs/onepercent/2011/07/bitcoin-is-not-inherently-anon.html

My point is that bitcoin transactions are broadcast to the whole network.  Everyone knows when 10,000btc is transfered from user X to user Y.  The transfer can be tracked to each subsequent user.  Identify one and you have a good chance of identifying more.  If I hand a $20k brick of used banknotes to a guy in London, do people all over the world hear about it?  That's true anonymity.

If bitcoins were officially recognised as a valuable commodity you can bet law enforcement agencies would be interested in tracking down the thieves. 

You seem to be unaware why the purchasing power of money increases when there is no change in the supply or demand of the money. Let's say the total yearly output of an economy is a dozen apples, and $1 buys one apple. If there is a breakthrough in apple production and the economy is now 25% more efficient, 15 apples are now produced. If the supply of money remains the same, $1 will now buy 1.25 apples.


Now it seems you don't understand human incentives with regard to risk.

Early adopters spent time and money working on a project that produced a worthless digital token. Had they not done so, we would not be here to discuss Bitcoin. However, one of the real reasons they did so is the knowledge that due to its properties, it could one day be worth much more than nothing. To say that it causes "unwarranted gain" is to say that you don't believe Bitcoin is worthwhile.

Also, you can call Bitcoin a "digital trash token" all you want, but the fact that individuals of their own free will exchange dollars with which they can buy anything for Bitcoins flies in the face of that claim. I can already hear you foaming at the mouth, spittle flying everywhere "BUT THEY JUST WANTS THEY PROFITSSSS!" - so fucking what?


Nope. It is a creation of wealth. Bitcoins were worth nothing, then early adopters came along, now Bitcoin is worth something. They built this system that drew others, which increased the value of the system and their holdings in it. No central bank forced people to exchange dollars for bitcoins, they did it freely.


Kind of. There's two complaints about inflation in a system such as ours.

1) The inflation is arbitrary - those with information profit at the expense of those without
2) The inflation is centralized - those who receive new money first profit at the expense of those who receive it later
3) Inflation disincentivizes saving - saving is consuming less than necessary in the present, in order to use that surplus to build better capital for the future

So really, I think a decentralized, crypto-currency with algorithmic inflation would be much better than the current system, but it still disincentivizes saving.

Yes, Bitcoin is currently going through an inflationary period. That's how the initial units of money are being distributed. It was never designed to have a stable exchange rate against the dollar. The rules of the network have been public for anyone to see since the beginning. There is complete transparency here, unlike at central banks.


What? How about you use more logic and less rhetoric?

all you have to do is go back in history the last 4 decades and ask yourself how did Greenspan/Bernanke deal with every lapse in the economy?  they lowered interest rates which by definition is increasing the money supply via purchasing UST's.  no, they didn't raise the CPI first.

It's great that a bunch of people who have never heard of the austrian school of economics before bitcoin believe Mises's definition of inflation, but if you want to talk with people who actually have common sense, the word should mean what it means in a dictionary. When someone is obviously using the "mainstream" definition, correcting them to the Mises's definition is pedantic. Especially when his definition is targeted towards how central bank fiat currencies operate, not how a fixed-money supply like bitcoin would, assuming it had inflation.

Lol in what universe does doing absolutely nothing and achieving a 300% return equate to "increased productivity"? I don't have a specific problem with deflation that is any worse than inflation, but the model of bitcoin obviously and intentionally causes unwarranted gain to those who were there first. Value does not appear out of thin air. The ability to use a digital trash token does not merit you a 300% or 3 million % return--as in the case of the earliest adopters. It is a transfer of wealth. Isn't the main complaint about inflation is how it makes our money worth less? What am I missing here that hasn't happened in bitcoin? That after enough millions in wealth are transferred that it will happen less often and will be spread across the backs of more copper-scrounging slaves in the future? Wow, what a refreshing redefinition of money. And these copper-scrounging slaves are the ones expected to keep the network running, ROFLMAO.

most of us here who believe in Bitcoin also believe in the Austrian definition of inflation/deflation which is related to the money supply (currency plus credit), not the price.  price is a secondary phenomenon which responds to the supply.  no wonder we disagree so vehemently on the outlook for Bitcoin.

Explain why this is a bad thing. Why should people not be able to save money and have it benefit from the increased productivity of the economy, rather than having it sucked away by monetary inflation?

Being able to buy a loaf of bread for 1 BTC one year and 0.25 BTC the next is a staggering return. It has little to do with whether or not you convert it to USD. If there were an actual economy to speak of, this would be more evident, but you assume I mean USD because that is the mentality of bitcoin users.


Any variant of bitcoin does essentially the same thing. Again, Cluster was referring to the specific idealism of the bitcoin model. Bitcoin could have been inflationary, bitcoin could have been deflationary with a much less early-heavy scheme.


Both of these definitions are undeniably wrong. Inflation refers to an increase in prices over time; deflation refers to a decrease in prices over time. *Monetary* inflation refers to expanding the money supply; it does not necessarily cause *price* inflation. *Monetary* deflation generally does not exist because you can't force the removal of currency from circulation except in extreme scenarios. Nobody in their right mind would ever refer to bitcoin as being monetary deflative. Too many people confuse these terms because they equate monetary inflation with price inflation because of how fiat currencies work and how pitifully bad central banks are at doing their job, or alternatively how good they are at keeping the wealthy wealthy and the poor poor. Funnily enough, bitcoin has achieved basically the same thing.


And you may personally feel that way because you have a lot of coins. Maybe you don't. I don't have any way of knowing and you can't prove you don't because of the nature of pseudo-anonymous wallets.

Regardless, you are going to have a lot harder time convincing new suckers that bitcoins are worthwhile when they were $35 and are now $2. And there was a large sentiment expressed that bitcoins had nowhere to go but up when they were $35. I could only laugh and get squelched for telling those people they were stupid. *I* was accused of being a paid shill for predicting what eventually happened. I'm quite sure it happened without regard to anything I said. And *I* certainly didn't have anything to gain by screaming to the world that bitcoins were going to drop like a rock. Those who claimed it would hit $100 certainly had something to gain. But were they ever accused of being paid shills? Naw...


I may be abrasive, but my goal is to convince people on the fence that bitcoin is a great idea with a terrible execution. I know there is no hope for convincing early adopters who believe that transferring wealth from newcomers to them is just how it has to be. I don't care. It is not you I am trying to convince. You have an interest in seeing an ungainly return on your investment; I have an interest in making sure people don't lose their money to you. Why? I don't know, maybe I just actually have a conscience.

That has what to do with what I said?


Don't you realize how dumb this sounds? "OH I thought you meant a reduction of the money supply! LOL OOPS!"

Cluster said "its deflationary model" referring to the specific model of money that bitcoin uses. You know, the one where 50% of the money to ever be produced is given away in the first 4 years?

Believe it or not, there are other ways to achieve deflation than Bitcoin's model.
Believe it or not, there are other ways to achieve inflation than central banks.

Instead of allowing a natural economy to develop, Bitcoin promoted hoarding, caused a bubble, and now a collapse that is continuing to make people lose faith in its ability to be a currency.

Bruce Wagner.  But then again, I LOVE pointing fingers...

Finally, you get it.

And that has nothing to do with promises of staggering returns. Nope, nothing at all.

Oh yeah? Who's behind MyBitcoin?  Where did the thief of the 25k bitcoins go earlier this summer? Who is he? Can you even label one individual by name who was involved in any Bitcoin theft?

No? Then Bitcoin is pretty damn anonymous - and you can assume anyone trying to move more money in secret, with a modicum of expertise, could be even more anonymous.

I've seen this mentioned more than a few times on this forum.  Wealthy people with money to hide/transfer can use bitcoins to move it.

There are two problems:

1: Transactions are not anonymous.  Everyone can see everyone else's transactions, and exactly how many bitcoins are being transferred.  Link the address to a known person and you can take down the whole network.  A bunch of unmarked, circulated banknotes or a gold bar are superior.

2: Those bitcoins have to be converted to money sooner or later, somewhere, connected to a real bank.  Maybe bitcoins will have value as an actual bitcoin sometime in the future.  The current value is solely measured by what other currency you can convert it to.  Even the bitcoin businesses on the internet (the vast majority being small concerns) are just a proxy for converting bitcoins into cash.  The products they sell weren't bought with bitcoins, and the taxes on those products weren't paid in bitcoins either.

It's really puzzling to me.

you're assuming that the money couldn't be broken up into tranches and distributed to intermediaries for an eventual cashout via mtgox or anyone of a number of the other exchanges.  it can be done especially if you're involved in a network of say money launderers.

they can't.  Because all money movement is centralized at mtgox.