Topic: Lets pretend for a minute that major BTC companies are scams. - page 2. (Read 2484 times)

Well yes, its possible I think - I've pondered on the same thing myself, it could actually ALL be a giant scam, what more could a greedy person want than a get rich quick investment.

However I do think, that at its current growth, if it did start out a scam, then perhaps if the market growths enough it can outgrow any possible scam - so it will all be ok .... or the whole thing could just vanish and "poof your moneys gone".

The fact that EVERYONE isn't operating on this assumption already is of utmost concern to me. People are so blinded by their greed that they have forgotten all of the evil entities that prey on any new technology. People are so quick to hand their money over to some mostly anonymous person they met on the internet. And we're not just talking about bitcoins either. Bitcoin related scams are sucking up real cash just as much as they are sucking up bitcoins.

Make money slowly is the method that all good advisors recommend. The time to be an early adopter has come and gone and bitcoin is now in the make money slowly phase of it's life. A skilled speculator might be able to game the system but greed gets those peoples money too.

Mining has followed the make money slowly model for a "long time" now... ASICs may indeed come. I hope they do, I would like to own at least one. But I don't believe the profits promised are realistic. It will still be a make money slowly situation and anyone who tells you differently is probably a liar. I don't want to be first in line to own one thats for sure.

I'll sign up for a free FPGA any day of the week though and I don't care what sig I have to wear to get one cause I'm only slightly less greedy than the next guy.

Yeah, that doesn't really take any pretending.

That's exactly that. What's bad about the term "fake bitcoin"?
I wouldn't it calling it that if you couldn't pay with mtgox balances to merchants with the coins never leaving the exchange.

There is no way to produce a fake bitcoin, maybe you mean that any exchange could be running a fractional reserve or cheating with trades.

I think he's insinuating that Mt Gox doesn't have sufficient reserves on hand to cover all user deposits.

If that would happen I would constantly shift every 5 minutes between a strong feeling of anger and rage to a feeling of deep depression.

So it would be just the same as everyday when I drive to work.


...

No really, I don't want to spread FUD, but I know why I currently hold my funds and don't invest in new mining equipment. Don't think its all a scam but the next month a to uncertain to make any moments in that direction. At least for me.


And why should any exchange hold face BTC. Unless they already spend their customers BTC elsewhere.
All BTC that are displayed had to be deposit somehow.

Basically debt denominated in BTC which cannot be paid out. I call them that way because it is practiced to refer to mtgox balances as "bitcoins".
To produce a fake BTC the exchange would simply add a fake sell order to the book and allocate it as it applies.

What is a "fake" bitcoin ?

What would happen if:

• All startups selling mining ASICs either directly or access to them are scams.
• Almost all GBLSE assets turn out to be a Ponzi or is only proftable as one.
• Major exchanges sell fake BTC or buy BTC with fake USD.

Before some of you call the scenario ridiculous and cry FUD consider this:

Before these ASIC companies showed up it was common consensus that a bitcoin ASIC would be very far down the road and that it would cost simply too much money and resources to do it. Then BFL showed up and the opinions shifted, suddenly it was the skeptics who were on the defense. They created an army of "supporters", yet the fundamental challenges remain. A background check didn't reveal any capability of producing such technology but a history of fraud.

Almost all GBLSE assets fall into these 2 categories: Mining and Lending.
The latter one is obvious: Effective interest rates are so high that there is no competition to bank loans. Added to that everybody can contact the Islamic Bank of Bitcoin with their business model and receive a free loan.
The former isn't so simple: While mining could generally be called a sound endeavor this is only true if it really produces coins at a sufficient operating margin. With the current way these mining "bonds" are set up that is not necessarily the case. We see the result in the ridiculous difficulty these days.

The history of exchanges is not a rosy one. Every one of them had their "hacks", glitches, was shut down or abandoned. Mtgox reigns supreme over the exchange market, and they are not audited. We know very little of the internal proceedings of it, and how much access individuals have to the system. Such a scenario would almost certainly go unnoticed. If fake bitcoins are sold it would only be noticeable on a bankrun since the vast majority of them is kept on the exchange by speculators. The opposite direction is also true, only if a huge part of the fiat money is withdrawn there would be issues.
At no point we were close to such a scenatio so during any period of it's operation nothing would have been noticed. I am aware that is highly speculative assessment because it can not be proven until it is too late.