Thank you for the answers. Now I have a new question, I found a blog entry tagging the bitcoin system as SCAM http://www.good.is/posts/why-bitcoin-is-a-scam/
How will you defend the system from Tim Fernholz's arguments?
Topic: Some questions about the bitcoin system - page 2. (Read 1320 times)
First of all, let me to say that I already read some FAQs about that here and there, and also saw some videos... I now understand mainly how the system works, but I still having some doubts about it.
Q1: I read somewhere that there is a maximum volume of Bitcoins allowed by the system, if this is true, Why? And how will this affect to the bitcoin economy once that maximum is reached?
Q1: I read somewhere that there is a maximum volume of Bitcoins allowed by the system, if this is true, Why? And how will this affect to the bitcoin economy once that maximum is reached?
Once all of the Bitcoins are "mined" or "minted" (whichever way you want to look at it), then as the economy continues to expand, the value of individual Bitcoins will appreciate to match the ratio of Bitcoins to its represented economic value. Put more simply, Bitcoins will continue to increase in real value over time. While some predict that this effect will make people never want to spend their Bitcoin, last month I bought a new computer, even though I knew that this month there will be a better/faster model. When you need things, you need things, and while Bitcoin does tend to bias people more toward saving, it won't prevent people from using them as money to exchange for goods or services when they need said goods and/or services.
Q2: I also read that if someone tries to fraudulently generate a huge amount of bitcoins, by using a modified client for example, it will be rejected from the system. How?
The Bitcoin protocol is very clear on what's allowed and what's not. If you generate transactions or blocks that violate these protocols, they will simply be ignored. If you cross out the "5" on your five-dollar bill and write "20", people will ignore your alteration. Attempts to defraud the Bitcoin protocol would be just as transparent and equally ignored.
Q3: As I understood it is possible to a single user to have multiple wallets for bitcoins, and also there are a lot of sites offering bitcoins for free. So what happens if someone abuses of that and then transfers the money to a main wallet? There are some transaction fees?
Abuse of the free Bitcoin sites (eg Bitcoin Faucet) is a problem they struggle with on a daily basis; the last time I checked at the Faucet they required a Google login, which shifted the anti-abuse burden to Google. They also only give a very small amount to get you started. There is nothing to prevent you from trying to milk each of those sites for as much Bitcoin as you can get out of them, except, of course, your conscience.
First of all, let me to say that I already read some FAQs about that here and there, and also saw some videos... I now understand mainly how the system works, but I still having some doubts about it.
Q1: I read somewhere that there is a maximum volume of Bitcoins allowed by the system, if this is true, Why? And how will this affect to the bitcoin economy once that maximum is reached?
Q2: I also read that if someone tries to fraudulently generate a huge amount of bitcoins, by using a modified client for example, it will be rejected from the system. How?
Q3: As I understood it is possible to a single user to have multiple wallets for bitcoins, and also there are a lot of sites offering bitcoins for free. So what happens if someone abuses of that and then transfers the money to a main wallet? There are some transaction fees?
Q1: I read somewhere that there is a maximum volume of Bitcoins allowed by the system, if this is true, Why? And how will this affect to the bitcoin economy once that maximum is reached?
Q2: I also read that if someone tries to fraudulently generate a huge amount of bitcoins, by using a modified client for example, it will be rejected from the system. How?
Q3: As I understood it is possible to a single user to have multiple wallets for bitcoins, and also there are a lot of sites offering bitcoins for free. So what happens if someone abuses of that and then transfers the money to a main wallet? There are some transaction fees?
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