Good news; ECB 2012/10 report on virtual currencies - page 2.

nobbynobbynoob

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Annuit cœptis humanae libertas

Quote from: kiba on October 29, 2012, 06:29:56 PM

Quote from: nobbynobbynoob on October 29, 2012, 05:43:32 PM

An interesting and mostly surprisingly objective paper. Almost unbelievable, this, coming from banksters.

Perhaps, those banksters are not so evil you thought?

Some of them are, but arguably perhaps not as evil as those who granted them special monopoly privilege over the money supply to begin with. Then again, the banksters may have successfully lobbied past governments in order to extract this very privilege, and around and around we've gone since then.

Bitcoin is a real spit stirrer. Sure, gold is great, but you can't ship gold around the world quasi-anonymously at the touch of a button!

kiba

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Quote from: nobbynobbynoob on October 29, 2012, 05:43:32 PM

An interesting and mostly surprisingly objective paper. Almost unbelievable, this, coming from banksters.

Perhaps, those banksters are not so evil you thought?

hazek

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Quote from: nobbynobbynoob on October 29, 2012, 05:43:32 PM

An interesting and mostly surprisingly objective paper. Almost unbelievable, this, coming from banksters.

Well they do get some of it wrong, naturally trying to insert themselves as good samaritans who would just like to look out for us Roll Eyes

:

Quote

In these schemes, the settlement asset is the virtual currency, and therefore the finality and
irrevocability of payments cannot be ensured. Only central bank money can do so, because central
banks present no default risk and act as lender of last resort to the member of the system in order to
stop any possible chain reaction resulting from payment incidents or unforeseeable liquidity
shortages.10 Virtual currencies cannot therefore be considered to be safe money, since the likelihood
of the asset retaining its value for the holder, and hence its acceptability to others as a means of
payment cannot be ensured. It simply relies on the creditworthiness of the issuer of the
settlement asset. The level of safety is clearly below that of commercial bank money, as commercial
banks are subject to prudential requirements and are supervised in order to reduce the likelihood of
default, thereby improving the safety of claims on these institutions.

BCB

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BCJ

While "banksters" may have paid for this, it was clearly created by very intelligent, probably highly paid, academic team who use a very impressive and thorough list of references.

Kudos for them.

I wonder if the authors are aware of this thread. It would be interesting to hear from them.

nobbynobbynoob

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Annuit cœptis humanae libertas

An interesting and mostly surprisingly objective paper. Almost unbelievable, this, coming from banksters.

BCB

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BCJ

hazek

by the same token, were I able to wire you a trillion dollars you would receive them electronically, virtually, and they would represent value in the databases which receive them. You could then wire those zeros and ones to another bank and go to that bank and withdraw fiat. Now you probably couldn't carry 1 trillion dollars, if that amount of even physically existed but you could wire that virtual fiat to the irs to pay taxes, you could wire to your credit card company or another bank to pay a dept. The fact that the physical dollar does not exist does not make it virtual. It still has value for the recipient.

blablahblah

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Quote from: ?? on ??

Quote from: ECB

the issue of Bitcoin’s legal framework has been raised in the European Commission’s Payments Committee.

I wonder who raised it? Visa & Mastercard most probably.

The Commission is the highest authority in the EU. They make the rules, that all member states are required to implement. They tend to be lobbied very hard by mega corporations, like Visa.

Presumably, Visa and Co. wouldn't want to appear to be lobbying too hard in this case.
Excessive whining about Bitcoin might be like saying "here are our balls. Please squeeze!"

Holy shit. Check out the conclusions on p48-ish... Epic veiled threats bonanza!

Forget the lobbiests. Looks like these financial war games are about to get fun. Your move, Bernanke.

BCB

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BCJ

Quote from: hazek on October 29, 2012, 05:11:53 PM

Quote from: BCB on October 29, 2012, 05:03:56 PM

Virtual currency schemes differ from electronic money schemes insofar as the currency being used as the unit of account has no physical counterpart with legal tender status.

Dollars and Euro's have some physical counterpart with legal tenter status.

You are defining "Virtual"

I'm defining "Virtual Currency"

While 97% of fiat may be "virtual" ie is does not exist in the real world, it is not a "virtual currency" as is has legal tender status.

Bitcoin is a true virtual currency.

Well then I disagree with your definition of "virtual", I don't think having a physical counterpart that has a legal tender status vs having a physical counterpart that does not makes the later a virtual but not the former.

Bitcoin is currently 10.68. I'm going to mail you a 10 dollar bill two quarters and a dime a nickle and three pennies.
When you get it Please send me 1 btc.

now you can take that fiat money to the bank to the store to the irs and pay for or buy something.

What can I do with the btc besides convert it for a non-virtual currency, or trade if for something else of value.

hazek

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Quote from: BCB on October 29, 2012, 05:03:56 PM

Virtual currency schemes differ from electronic money schemes insofar as the currency being used as the unit of account has no physical counterpart with legal tender status.

Dollars and Euro's have some physical counterpart with legal tenter status.

You are defining "Virtual"

I'm defining "Virtual Currency"

While 97% of fiat may be "virtual" ie is does not exist in the real world, it is not a "virtual currency" as is has legal tender status.

Bitcoin is a true virtual currency.

Well then I disagree with your definition of "virtual", I don't think having a physical counterpart that has a legal tender status vs having a physical counterpart that does not makes the later a virtual but not the former.

BCB

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BCJ

Virtual currency schemes differ from electronic money schemes insofar as the currency being used as the unit of account has no physical counterpart with legal tender status.

Dollars and Euro's have some physical counterpart with legal tenter status.

You are defining "Virtual"

I'm defining "Virtual Currency"

While 97% of fiat may be "virtual" ie is does not exist in the real world, it is not a "virtual currency" as is has legal tender status.

Bitcoin is a true virtual currency.

hazek

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Quote from: BCB on October 29, 2012, 04:43:07 PM

Quote from: hazek on October 29, 2012, 04:33:36 PM

Quote from: BCB on October 29, 2012, 04:31:57 PM

I think that is the salient point here.

It's not, it's that both, functionally, are a virtual currency.

Ok. Define virtual currency then make your point again. I think you are clouding the issue. Hopefully your explanation will help clear that up.

Thanks.

How about you define it and I'll let you know if you got it right?

hazek

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Quote from: molecular on October 29, 2012, 04:42:21 PM

Quote from: page 22

Economic foundations of Bitcoin
The theoretical roots of Bitcoin can be found in the Austrian school of economics and its
criticism of the current fiat money system and interventions undertaken by governments and
other agencies, which, in their view, result in exacerbated business cycles and massive inflation.

wow!

They even got the correct short version of the Austrian theory of the business cycle! I know, unbelievable right? Shocked

BCB

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BCJ

Quote from: hazek on October 29, 2012, 04:33:36 PM

Quote from: BCB on October 29, 2012, 04:31:57 PM

I think that is the salient point here.

It's not, it's that both, functionally, are a virtual currency.

Ok. Define virtual currency then make your point again. I think you are clouding the issue. Hopefully your explanation will help clear that up.

Thanks.

molecular

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Quote from: page 22

Economic foundations of Bitcoin
The theoretical roots of Bitcoin can be found in the Austrian school of economics and its
criticism of the current fiat money system and interventions undertaken by governments and
other agencies, which, in their view, result in exacerbated business cycles and massive inflation.

wow!

iain

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lol @ bubbly bubbly bubble graph on page 26

bubbles blowin' down into negative USD/BTC territory... bubbles reaching back in time just by, uh, being circular... this graph deserves a PRIZE for inscrutability Cheesy

hazek

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Quote from: BCB on October 29, 2012, 04:31:57 PM

I think that is the salient point here.

It's not, it's that both, functionally, are a virtual currency.

BCB

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molecular

good point.

hazed, I see you point and your statement may or may not be true, depending on your stance but for now euros and dollars, despite how many physical specimens exist relative to the total balance outstanding, are still legal tender and bitcoin is not. I think that is the salient point here.

Akka

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Wow, just read over it real quick. (I'm tired will read it in full tomorrow.)

They really have put a lot of work in this, informed themselves really well and it's written by people that actually understand bitcoin.

3 Surprises in one article, I'm stunned. This is great.

molecular

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Quote from: hazek on October 29, 2012, 04:21:34 PM

Quote from: lebing on October 29, 2012, 04:14:44 PM

Yes, this actually is a really good report.

Quote from: hazek on October 29, 2012, 04:03:15 PM

Quote from: BCB on October 29, 2012, 03:57:19 PM

hazek

[snip]This also means that since the only difference between bitcoins and dollars is that bitcoins' physical counterparts aren't legal tender that they admit dollars, euros and the rest of the fiat currencies are essentially virtual currencies.[/snip]

I don't follow.

bitcoins - virtual currency with physical counterparts (Casascius, bitbills, ect..)

euros - "electronic" currency with physical counterparts that are legal tender

Seems to me, there is only one difference between these two currencies and it's not that one is a virtual currency and the other isn't.

What is the difference between an electronic and a virtual currency... Huh

NONE. That's my point, there is no difference. Their precious euros and dollars are just as virtual as our bitcoins, the only difference being that the physical counterparts to their virtual currency are legal tender. Cheesy

I think you are correct. However I doubt the authors of the papers think of Casascius coins when they say "physical counterparts".

In their mind physical counterpart to bitcoin is probably: nothing ("has no physical counterpart with legal tender status")
and physical counterpart to number in western union database is: the dollar, legal tender.

hazek

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Quote from: BCB on October 29, 2012, 04:22:54 PM

hazek

I still don't think you point, while an important one, is clear....

What isn't clear? My point is functionally their currency is virtual just like bitcoins. The only difference is the words they use to describe it and the legal tender status of it's physical counterparts.

Topic: Good news; ECB 2012/10 report on virtual currencies - page 2. (Read 6864 times)