How deflation will eat bitcoin | Bitcointalksearch.org

coinft

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Quote from: Stampbit on April 09, 2013, 10:33:19 AM

Quote from: justusranvier on April 09, 2013, 10:14:52 AM

Quote from: Stampbit on April 09, 2013, 10:08:45 AM

So where then does its real value come from?

At the moment it is hugely benefiting from the lack of a feature - the ability to be remotely confiscated.

For someone who is not a political insider with connections in the upper levels of international banking, every possible place to store savings carries the risk of being frozen or confiscated. Every time the weekend comes around there's a real possibility that you won't be able to access your money on Monday. Without connections you'll never know before it's too late.

Holding bitcoins avoids that risk.

The fed, who loves to print trillions of paper bills every year, or any billionaire for that matter, could just as easily buy up all available coins and then freeze them, causing a massive deflationary spiral much like were seeing today, which would enrich them to a point where if they wanted to destroy the bitcoin economy they could issue massive sell off's that would send it plummeting and have retailers running far far away from this super dangerous currency, which after bankrupting everyone would effectively kill bitcoin.

For every bitcoin they buy from me I will double the price. They will need more than mere trillions, and they are welcome to try

If they really do it and then dump, I' ll buy back at bottom.

Thinking you can buy out a company, and much less a currency for mere market cap is stupid.

kjj

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Quote from: Stampbit on April 09, 2013, 10:33:19 AM

Quote from: justusranvier on April 09, 2013, 10:14:52 AM

Quote from: Stampbit on April 09, 2013, 10:08:45 AM

So where then does its real value come from?

At the moment it is hugely benefiting from the lack of a feature - the ability to be remotely confiscated.

For someone who is not a political insider with connections in the upper levels of international banking, every possible place to store savings carries the risk of being frozen or confiscated. Every time the weekend comes around there's a real possibility that you won't be able to access your money on Monday. Without connections you'll never know before it's too late.

Holding bitcoins avoids that risk.

The fed, who loves to print trillions of paper bills every year, or any billionaire for that matter, could just as easily buy up all available coins and then freeze them, causing a massive deflationary spiral much like were seeing today, which would enrich them to a point where if they wanted to destroy the bitcoin economy they could issue massive sell off's that would send it plummeting and have retailers running far far away from this super dangerous currency, which after bankrupting everyone would effectively kill bitcoin.

I hope they do. That would be absolutely the best possible thing to happen to bitcoin. Let's all hope that the central bankers aren't familiar with the adventures of Br'er Rabbit.

tutkarz

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Activity: 546

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Quote from: Stampbit on April 09, 2013, 10:59:01 AM

Quote from: tutkarz on April 09, 2013, 10:48:24 AM

Quote from: Stampbit on April 09, 2013, 10:41:18 AM

I'd just like to point out that deflation creates the possibility for a central power to collect a massive amount of coins thereby causing its price to rise thereby allowing them to buy more coins. By setting a hard limit on coins what satoshi has essentially done is create an avenue for a central bank to appear.

but that makes everybody rich, dont you think? And currently they are printing more money basically stealing value from other owners. There is no perfect solution. To me current is worst possible (printing one).

But eventually the bank ends up with most of the coins, so you're microcoins may be worth more, but the 10million or so coins now sitting in the banks vault will never held again.

banks already can print any amount of money, isnt it absurd?

myrkul

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FIAT LIBERTAS RVAT CAELVM

Quote from: Stampbit on April 09, 2013, 10:59:01 AM

Quote from: tutkarz on April 09, 2013, 10:48:24 AM

Quote from: Stampbit on April 09, 2013, 10:41:18 AM

I'd just like to point out that deflation creates the possibility for a central power to collect a massive amount of coins thereby causing its price to rise thereby allowing them to buy more coins. By setting a hard limit on coins what satoshi has essentially done is create an avenue for a central bank to appear.

but that makes everybody rich, dont you think? And currently they are printing more money basically stealing value from other owners. There is no perfect solution. To me current is worst possible (printing one).

But eventually the bank ends up with most of the coins, so you're microcoins may be worth more, but the 10million or so coins now sitting in the banks vault will never held again.

I don't see that as a problem. Hoarded coins are functionally identical to destroyed coins.

Stampbit

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Activity: 182

Merit: 100

Quote from: tutkarz on April 09, 2013, 10:48:24 AM

Quote from: Stampbit on April 09, 2013, 10:41:18 AM

I'd just like to point out that deflation creates the possibility for a central power to collect a massive amount of coins thereby causing its price to rise thereby allowing them to buy more coins. By setting a hard limit on coins what satoshi has essentially done is create an avenue for a central bank to appear.

but that makes everybody rich, dont you think? And currently they are printing more money basically stealing value from other owners. There is no perfect solution. To me current is worst possible (printing one).

But eventually the bank ends up with most of the coins, so you're microcoins may be worth more, but the 10million or so coins now sitting in the banks vault will never held again.

tutkarz

hero member

Activity: 546

Merit: 501

Quote from: Stampbit on April 09, 2013, 10:41:18 AM

I'd just like to point out that deflation creates the possibility for a central power to collect a massive amount of coins thereby causing its price to rise thereby allowing them to buy more coins. By setting a hard limit on coins what satoshi has essentially done is create an avenue for a central bank to appear.

but that makes everybody rich, dont you think? And currently they are printing more money basically stealing value from other owners. There is no perfect solution. To me current is worst possible (printing one).

bb113

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Activity: 728

Merit: 500

Quote from: Stampbit on April 09, 2013, 10:33:19 AM

Quote from: justusranvier on April 09, 2013, 10:14:52 AM

Quote from: Stampbit on April 09, 2013, 10:08:45 AM

So where then does its real value come from?

At the moment it is hugely benefiting from the lack of a feature - the ability to be remotely confiscated.

For someone who is not a political insider with connections in the upper levels of international banking, every possible place to store savings carries the risk of being frozen or confiscated. Every time the weekend comes around there's a real possibility that you won't be able to access your money on Monday. Without connections you'll never know before it's too late.

Holding bitcoins avoids that risk.

The fed, who loves to print trillions of paper bills every year, or any billionaire for that matter, could just as easily buy up all available coins and then freeze them, causing a massive deflationary spiral much like were seeing today, which would enrich them to a point where if they wanted to destroy the bitcoin economy they could issue massive sell off's that would send it plummeting and have retailers running far far away from this super dangerous currency, which after bankrupting everyone would effectively kill bitcoin.

Another way it could work out is that people eventually get enough dollars for their needs and will only part with bitcoins for actual goods and services after that.

Stampbit

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Activity: 182

Merit: 100

I'd just like to point out that deflation creates the possibility for a central power to collect a massive amount of coins thereby causing its price to rise thereby allowing them to buy more coins. By setting a hard limit on coins what satoshi has essentially done is create an avenue for a central bank to appear.

Stampbit

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Activity: 182

Merit: 100

Quote from: myrkul on April 09, 2013, 10:34:48 AM

Oh goody. ANOTHER deflation thread.

No, another volatility thread Wink

myrkul

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FIAT LIBERTAS RVAT CAELVM

Oh goody. ANOTHER deflation thread.

Stampbit

full member

Activity: 182

Merit: 100

Quote from: justusranvier on April 09, 2013, 10:14:52 AM

Quote from: Stampbit on April 09, 2013, 10:08:45 AM

So where then does its real value come from?

At the moment it is hugely benefiting from the lack of a feature - the ability to be remotely confiscated.

For someone who is not a political insider with connections in the upper levels of international banking, every possible place to store savings carries the risk of being frozen or confiscated. Every time the weekend comes around there's a real possibility that you won't be able to access your money on Monday. Without connections you'll never know before it's too late.

Holding bitcoins avoids that risk.

The fed, who loves to print trillions of paper bills every year, or any billionaire for that matter, could just as easily buy up all available coins and then freeze them, causing a massive deflationary spiral much like were seeing today, which would enrich them to a point where if they wanted to destroy the bitcoin economy they could issue massive sell off's that would send it plummeting and have retailers running far far away from this super dangerous currency, which after bankrupting everyone would effectively kill bitcoin.

justusranvier

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Quote from: Stampbit on April 09, 2013, 10:08:45 AM

So where then does its real value come from?

At the moment it is hugely benefiting from the lack of a feature - the ability to be remotely confiscated.

For someone who is not a political insider with connections in the upper levels of international banking, every possible place to store savings carries the risk of being frozen or confiscated. Every time the weekend comes around there's a real possibility that you won't be able to access your money on Monday. Without connections you'll never know before it's too late.

Holding bitcoins avoids that risk.

Stampbit

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Activity: 182

Merit: 100

We have 21 million total coins that will one day be mined, but unlike most currencies if we lost all but one coin we could break it down in such a way as if 21million never mattered. So it can be said that the concept of a 'coin' is purely psychological, and that we in essence have an infinite supply. Currently the price is rising purely based on speculation, speculation that one day this coin will have real utility in day to day use, as for now there is little use except as a p2p payment system or through the few merchants who actually accept it. So where then does its real value come from? Businesses of course, the same businesses, who often have razor thin profits margins, that favor predictability over profitability.

So the bitcoin market is causing massive volatility swings because it believes one day it will not have massive volatility swings.

Topic: How deflation will eat bitcoin (Read 1512 times)