Topic: Is Bitcoin money? - page 154. (Read 112173 times)

The default situation for governments is the same as for Bitcoin. Then governments make laws to give their currencies additional advantages. Bitcoin managed even without these extra advantages.

No, but there is an endless list of governments with bad currencies that has expropriated and banned posession of other currencies, legislated artificial exchange rates, run special foreign currency stores, demanded foreign currency deposits from foreigners, demanded exchange of certain sums before entry into the country and raided banks for gold and foreign currency.

I agree with all of this so far, even though I disagree that it's as much a burden as you imply.  The vast majority of casual contracts never need any kind of enforcement, and even those operate within a civic standard for the vast majority of the above.  In the modern age, that civic standard is the government court system that we are all aware of, but this is not the only way these things have been done in the past.  Common law courts of the western societies prior to the rise of strong, centralized governments are one example; and international business courts are another more modern example.  Most of the contracts occur under some kind of default environment known to both parties, and the nature of said environment has no bearing upon Bitcoin or vise versa.


It certainly does behave like property.  Property is an abstract concept that existed long before nations or governments, and is independent of the existance of either.  To get right down to it, bitcoins are property because users behave as if that is the case.  As I see it, Bitcoin passes the 'Duck' test just fine.  Care to share how you have come to the conclusion that it does not?

That is the problem.

In order to enforce a contract involving Bitcoins, all the following conditions need to be fulfilled:

1) Bob and Alice need to agree on some centralised court or protection agency.
2) Bob needs to prove to the court that he "owns" Bitcoin address X by digitally signing a court statement.
3) Alice needs to prove to the court the she "owns" Bitcoin address Y by digitally signing a court statement.
4) Alice and Bob need to digitally sign a contract that 100 bitcoins will be sent from X to Y and that Alice will deliver 10 widgets to Bob.
5) Either Bob or Alice needs to leave some sort of collateral with the court, either in the form of an escrow deposit, or in the form of giving the court jurisdiction over their meat identity.
6) Alice needs to have the ability to prove to court that she has delivered 10 widgets.
7) Bob needs to have the ability to prove to court that he did not receive 10 widgets.


Bitcoin CAN be utilised in this way, but this would be cumbersome, expensive, and it would negate most of the advantages of Bitcoin, namely:

1) anonymity
2) low transaction costs
3) speed
4) independence from a centralised third party
6) irreversibility

People are not likely to use Bitcoin in the first place if they have to relinquish that much authority to a centralised court; they may as well use the court's own mint and be done with it.

This is why I said that Bitcoin doesn't pass the Duck Test for property.  The economic reality for the majority of Bitcoin users is that it doesn't behave like property. 

I shouldn't have to say this, but Bitcoin isn't a fiat currency.  It is a currency by the choices and designs of those who choose to use it.  Fiat currencies are currencies as a matter of law, so your obvious counterexample, isn't.

As for your belief that governments go to great lengths to get paid in anything other than their own currencies, try paying your property taxes in gold coins or in another fiat currency from another country.  If you can do this without the additional step of conversion into the local fiat currency, then I'd like to hear about it.

should we all have a drink together, say cheers and the focus more on making BITCOIn bigger vs. endless debates of what it is?

sorry for that "nasty' comment, but I feel we could bundle our energies vs. debating forever (I am sure apple people could have debated decades on how to call the IPad or iPhone or mac or whatever)

Bitcoin is intended to be used as money. The extent to which it differs from the various definitions of money is primarily due to its unpopularity and lack of government sanction, which in my opinion should not matter when speaking about it as "money."

Enforcement of contracts? Why?


That's not necessary. There is an obvious counterexample: Bitcoin. Governments often go to great lengths to get paid in anything but their own currencies. And wouldn't demanding taxes in any form and using that wealth to back the currency they issue to buy stuff do the same thing as demanding taxes to be paid in it?

I consider that economic definition take precedence and importance over legal definition. End of story.

Government are not forever. The rules of economics are. Government are authorities. Economics is a science.

You cannot nullify the concept of economic scarcity even when we entered a non-scarce economic reality. You cannot nullify truth.


Nobody is advocating on how to decide how much bitcoins is worth, what the proper use of bitcoins is, etc al. What people like me are doing is trying to DESCRIBE REALITY aka scientific definition, not prescribe some rules that bitcoiners shold be following.

In the way that people act in a manner that implies that, for them, there is no practical difference between the output of the accounting program and the physical trade of money.  Money is a social method of accounting, just a special one. 


The blockchain could be considered the unit of measure, as that isn't owned by anyone in particular.  But the ownership of a particular sum of bitcoins by a particular collection of addresses at a particular point in time; is, indeed, a form of intellectual property.  In the manner that it's is an abstract concept that we (the society known as the bitcoin community) assign a value to, and also agree upon a particular possession of.

It's not the best way to think of Bitcoin, I admit, but I was playing off of the post that I was responding to.


I am, in a manner of speaking.  I have always agreed with you that bitcoins are not money, but money and currency are not quite the same thing.  My disagreement with you is that I can't agree that bitcoins are a commodity, since they have no known alternative use in order to grant them value outside of the context of a medium of trade.  If they did, then they would be money in the literal sense.  As such, bitcoins are a new/unique form of currency unit.  Nothing more, nothing less.  To even call them a commodity is granting them more attributes than they posses.


All currency, fiat or otherwise, are simply numbers at their core.  Gold is money, but is only a currency in a form that can be considered a unit by the market, such as the troy ounce or the gram.  An undefined lump of gold isn't a currency, but it is still money.  All currencies are a unit of measurement, and all units of measurement are numbers.  The conversions of one currency into another, at a particular moment in time, is akin to the conversion of American Standard units into Metric.


I agree, and it is in that manner that bitcoins are similar to gold or silver coins used in trade.  I don't have the time to write an article on the subject.  Again, please read Whatever Happened to Penny Candy? before continuing with this debate.  I know that you don't realize it, but you suffer from misinformation that you can easily correct.  That book takes the reader back to the beginning of the formation of natural commerce, and explains why and how money developed.  You really cannot understand money until you start at the beginning.


You have the right to imagine a separation of program and the community, and I can see the logic.  However, you have neither the authority nor the ability to impose your rationale upon others.  This is why you will consistantly fail in your goal of defining bitcoins in any way that appears inconsistant to others, regardless of the logic or legal motivation of such a goal.

Basicly, you are 'pissing up a rope' in your attempts to get forum members to call bitcoins a form of commodity.  They will call it as they see it; be that a currency, or even money.

people act as if... (so?).

What people believe partially make up economic reality. (Yes. Theirs!)

Money is not defined legally,.. (actually, it is. In multiple citations.)

The court provide bad services. (The courts shouldn't be needed for Bitcoin to perform its function.)

What it does is act like money. (In what way does an accounting program act like money?)

It's a form of intellectual property,.. (It's as intellectual as an inch, or a kilometer.)

...but the paper object isn't the property. (You're making my argument, creighto.)

"Money (even gold) relies on some sort of centralised court or protection agency that enforces property rights." (Do you propose that Bitcoin do this? How?)

Neither bitcoins nor gold needs the protection services of governments nor courts to perform their primary functions ... (Yes.) ... as a trade medium. (No. How is a number a "trade medium"?)

The main page refers to Bitcoin avoiding the neccessity of a 'trusted third party'.  That third party is any institution that both parties trust to enforce the terms of the agreement (i.e. contract) upon the other should the deal turn sour.  This can be courts or governments, but can also be private institutions such as banking, Paypal, or whatever.  Thopse private institutions may (or may not) be limited in what kind of punishment that they can dish out to a bad player, but usually they also have the implicit backing of the courts via contract law anyway.  However, there is an overhead for such institutions; both in actual funds and in surrendered liberty/information. (Yes. But Bitcoin doesn't work like that. Bitcoin only keeps the records straight. The clients use whatever outside agents they wish.)

This is exactly why third party institutions are, thus far, so neccessary for online commerce; and why such institutions will likely come to exist within the bitcoin economy eventually as well. (Within Bitcoin no, but within the Bitcoin economy, yes.)

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I'm giving these statements a very shallow treatment, but so far I see no compelling reason why we should not put an imaginary wall between what is Bitcoin the program, and what is Bitcoin the community, the traders, and the economy.

If we make this distinction, we will see that there is no need for Bitcoin to ever go over its wall, to meddle in the "proper" use of Bitcoins, to decide how much a Bitcoin may be "worth", or to enforce private contracts.

And I think that is a good thing.