Topic: I am pretty confident we are the new wealthy elite, gentlemen. - page 124. (Read 631983 times)

If you are buying that large of amounts of money you will likely need to trust an entity that does not deal exclusively with bitcoin (so in the event their bitcion are stolen via a hack it can recover and honor deposits). A few examples would be second market, the COIN ETF that hopefully would be launched soon

The title of the thread went viral...or something:)

Why is a thread that Atlas started nearly 3 1/2 years ago still going strong?

I'd still cash out into FIAT if I had that much BTC lol...maybe not all, but most.

It states the problem, but what's the solutions?

Where is your average Joe going to get his Bitcoins without without trusting a third party like gox or mintpal?

The trust is the point of failure that probably is stoppong a lot more people jumping into btc

How can you get them?  Without sending money to btcE or bit stamp which I trust neither and don't even consider trusting the smaller less known exchanges etc

Until there's a rock solid way for someone to buy 100,000usd+ of Bitcoins with zero risk of being ripped off the whales will not jump on board

There is no exchange I would ever trust with 100k or more

^^

About service companies:

Companies like Bitpay can offer instant payment to the merchant in a non complex way, cheap. Companies like that can be many, there is no need for the gigantic back stage processing that credit card companies have. Sufficiently many, right-sized companies is not much of a risk to bitcoin.

Another example is low cost payments (Circle), in case the blockchain fee should increase significantly. Payment from one user of the system to another. A plethora of service companies like that. If necessary, the companies could establish 1 on 1 relationships to clear such payments between users of those different service companies. No system risk to bitcoin.

Bitcoin debit card companies (Coinkite) (A card like a debit card, denominated in bitcoin, paying out bitcoin to merchants). I guess some users would prefer a standard card in stead of using a more complex smartphone. Multiple companies could agree on a standard and make 1 to 1 clearing deals. Also no systemic risk.

These types of services are welcome. We will see how badly they will be regulated by coercion from the state, if not, they will be held in check by the market (with some cockups). If the market demands it, and it can be supplied to the right price, it is good.

^- One of the best reads in a long time.

At the risk of intruding on all the price speculation and we're-gonna-be-rich/poor stuff on here, I want to focus on something more fundamental for a minute.

There are essentially two threats that make transferring value online risky (and risk is expressed in expense).  The first is exploitation of a technical flaw by a cracker to redirect or obstruct the transfer.  The second is malfeasance by a money transmitter (which is why money transmitters have to get licensed and monitored, etc).  This is a trillion-dollar problem, in terms of it costing the world trillions of dollars per year to deal with this risk.

Blockchain-based cryptocurrency (at the moment, Bitcoin) is so far the only method of transferring value online to offer cryptographic protection from both of these threats.  So, at least potentially, the world has much to gain by doing business in Bitcoin. 

That said?  We take our business off the blockchain often enough for both threats to be relevant to Bitcoin transactions regardless of cryptographic protections.  We see prime examples of both risks in the collapse of Mt.Gox. 

Gox had a fatally flawed method of handling transaction malleability, and someone (or someseveral) exploited the technical flaw to steal a half-billion dollars worth of coin from Gox over a period of nearly a full year.  In fact we don't even know whether that technical flaw was a genuine mistake or deliberately inserted by people at Gox in order to facilitate the theft.  Which brings us to the second risk - malfeasance by a money transmitter.   Whether or not people at Gox planned the theft, they continued operating as a "fractional reserve" system long after they became aware of it - AND FAILED TO FIX IT, exposing themselves and their clients to continued theft!!  To cover the past and ongoing theft, they deliberately manipulated the market using "Willy Bot," sending the prices on an unsupported stratospheric ride as a desperate attempt to hold off the collapse.  This manipulation sucked more and more money into the black hole which was Gox for nearly eight months, multiplying both the duration/expense of theft and the collateral damage done in the collapse by at least factors of six.

Thus, even though the blockchain protocol is designed specifically to protect both against exploitation of technical flaws by crackers and against malfeasance by money transmitters, we have horrifically expensive examples of both wrapped up in a single incident.  Why did this happen?  It happened because we trusted Gox with our blockchain-secured money even when they were not using the blockchain protocol.  Essentially people gave up sole control of the cryptographic keys that controlled their coins, leaving them to Gox and trusting Gox as holder of keys to tell them whether or not the blockchain was intact with respect to their coins.  And Gox lied.

Malfeasance by money transmitters (such as Gox) has been demonstrated as a genuine risk for Bitcoin because Bitcoiners  allowed Gox to do something we didn't have to allow them to do.  Because we gave up control of our coins to another party, and trusted that party to be honest.  We made ourselves vulnerable to the primary risks that the Bitcoin protocol was designed to protect us from.  The expense of Gox's collapse put Bitcoin firmly into the same expense category as credit card transactions, wiping out the financial advantage of using Bitcoin.  Now as Bitcoin becomes more accepted, we're getting more money transmitters.  Bitpay, etc, are, like Gox, in the business of holding the keys to other people's money.  They are money transmitters whose potential for technical failure and malfeasance continues to put Bitcoin business in the same risk category as credit cards - and, inevitably, therefore in the same expense category as credit cards. 

This model (with money transmitters, online wallets, etc) does not realize the potential savings to the world of using Bitcoin.  Because merchants are still exposed to the risks of technical failure and of malfeasance, they are not saving risk (and therefore not saving expense).  The issue is not about whether Bitpay etc are immediately selling coins - the issue is about people trusting someone who is not themselves to hold their keys and therefore being vulnerable to the risk of that party's failure to hold the keys securely.

So, short version of the story; had you asked me a year ago, I would have said that the emergence of money transmitters in Bitcoin was an aberration because the protocol was built specifically so that people could do all of that for themselves.  I'd have said that Bitcoin would take off when people got over their reliance on third parties and therefore started realizing the potential for financial advantage.   But when I look at it today and I see money transmitters becoming entrenched in the Bitcoin economy, it's becoming more and more clear that if we don't get away from that, then we have nothing to offer merchants better than what the credit card companies are offering them.

It's one thing for me to explain to a CFO that they don't need the money transmitter or the exchange and that they can manage their own wallet and be fully protected from that third-party risk; but in the first place they don't usually believe me. Worse, there is a legit worry about first-party risk (ie, that a company insider with access to the wallet could steal the company's Bitcoin, as may or may not have happened at Gox).  Relying on money transmitters (third party risk that's bonded and insured) is their standard method for mitigating first-party risk (an inside job for which they'd eat the loss directly).

So, if we think Bitcoin is advantageous to the world -- if we want there to be a financial advantage to the world from using it -- we have to find ways to actually deliver the savings that the protocol was designed to deliver.  We have to enable the users to cut out money transmitters and third parties.

Yep.. sad but true... there are a lot of variations of such stories, and the downward BTC price manipulators can have this kind of negative scaring effect on regular people because the regular people have not been prepared for such an extended downtrend in the BTC market.... and they are still panicking on a regular basis in spite of decent flat and/or trending upward BTC price movements in the last couple  of days.  Regular people are scared to get into BTC and scared to stay in BTC.. even though this is likely a fairly decent time to enter a BTC position.

Except it already happened when price hit 300. In a very short amount of time there were countless posts on reddit and forums about people who put their money savings of  5-10 000 USD when btc price was around 500-800 and to cite them :"must cash now I cannot fail my family by loosing more". The price then took a quick dip to 275 where it stopped.

FTFY. I cannot disagree with your statement, I just think it's not right to limit it to one sphere.

A lot more folks could be wealthy in this industry if we worked better together and stopped scamming one another.

FTFY.

The FTC is not a law enforcement agency like the Marshalls, FBI of Police. Not likely they will have to auction anything because that takes time, they will dump them in as little as 3 weeks on the open market


The Federal Trade Commission (FTC) is an independent agency of the United States government, established in 1914 by the Federal Trade Commission Act. Its principal mission is the promotion of consumer protection and the elimination and prevention of anticompetitive business practices, such as coercive monopoly.

Off topic: I'm Romanian, but it's the 1st time I ever hear about this alt coin. Stories about everyone using it here are absolute bullish. Also didn't notice anything about it on the Romanian section on these forums.

On topic: I find it very hard to understand what has caused the price of bitcoin to be so low now. It is so innovative, so revolutionizing within the monetary system, that it should already be priced a LOT more than it is now. And I mean... a lot... like almost 1000X. Imo, it should be considered the new "gold", but with all the advantages it comes for the financial markets, unlike gold. Found this by googling: "A total of 174,100 tonnes of gold have been mined in human history". That's 174,100,000 Kg. And one kg is valued at around $37,000.  Now do the math for the amount of BTC already mined, or even for all 21 mil that would potentially ever exist and see where that goes price wise. It gave me about $306,000 / BTC.
And yes, I'm aware that is just wishful thinking, but who can predict what it's gonna be like 2 or 5 or 10 years from now?

I'd have to disagree. Being wealthy is a responsibility in itself, and you become a much higher profile target for all sorts of evil men. Especially the "benevolent" rulers.

There are a lot of downsides to wealth, and even more to fame. I've looked at it from near and on the fringes many times, and I've had wealthy friends who's names you would recognize. But I value their friendship more than the name dropping. The pros outweigh the cons to me, but the wealthy do not live simple lives. Having a simple life has certain appeal as well. Wealth in itself is not a goal for me. It's a milestone in my goals, but of itself it's not a goal. I would rather be wealthy than poor. I would in fact like to be ultra rich, because then I could achieve the things that are actually important to me. Understanding that linkage is difficult for most people, thus even if they manage to accumulate a fair amount of treasure, they generally piss it away trying to LOOK wealthy.

In my pleasures, I'm a simple man. I don't see this changing if I do achieve wealth. In my passions, I am not, and this most certainly won't change. I think the gentleman's question was legitimate.

I will buy them, so will many other people
the cheaper the better if they want to crash the price down a bit
I will happily take advantage of the dip if I get the opportunity
Before everyone else

Your crazy if you think a whale dump will affect the price for long
before it gets swallowed up, maybe even in large part by another whale
who's  been considering getting in when the price is  right

Wealth is power. I've never been rich, but I've been pretty well off, and I've been dirt poor and homeless. All have their good and bad points, but the good points of being wealthy outweigh the bad, because of the personal power you can wield. If you want to effect change as a poor boy, you have only your wit and voice. As a rich man, you have the ability to amplify that wit and voice with a great many things.

To me, wealth is not in itself a worthy goal, it's a measure of success in things that matter much more to me. Not the only measure by any means. But if I could achieve sufficient self sustaining wealth to not worry about what my family will eat next week, or next decade, I would have far more time for other ventures. I am not the guy who would win powrball and go bankrupt a year later

Well, in the classic sense a "gentleman" is someone who owns land...

So I don't qualify there. I'm not sure I'll ever be elite either, but I wouldn't mind