Topic: Techreview : Bitcoins are not a currency with horders (Read 2338 times)

And your point again? The only reason gold is now worth $1900 is because enough people agree it should... Other than that, it's shiny, but it truly has far fewer uses than other metals less precious.

You're missing my point. my point is that bitcoins haven't settled on any market defined value because currently the only reason they are worth so much is because everyone is going "hey I'm going to spend 10 dollars on bitcoins right now!" due to the speculators and hoarders, rather than because they're actively being used in a comercial aspect.

well a gram of gold dust would be worth $57.87 since gold has nearly hit 1800+ an oz lol! hook me up with some 50$ a gram gold imo
+1 to gold dust!

And your point is? If the dust is gold dust, that's exactly what would happen.

But you couldn't send that 50$ a gram of sand across the world for no fees, and in the time it takes to take a piss

What's your point? The bitcoins you had were only worth 50 dollars because speculators and hoarders drove the price high, rather than because bitcoins have any practical use at the moment other than converting them back into USD or otherwise. It's like saying "well this dust I picked up off the side of the road is valued at 50 dollars a gram!!" but only if you could find someone who's actually willing to pay that for it.

Hoarding is not the problem...not spending is the problem.  Hoarding and spending are not mutually exclusive things.  You can very easily be both a hoarder and a spender of bitcoin and both things are good for the bitcoin economy.

Visit Heirloom Tulip Bulbs to see what tulips are going for today. I choose the one below (and there are way more expensive ones) because one cost about 1 BTC. http://www.oldhousegardens.com/display.aspx?cat=Tulip

ABSALON, 1780  Rarest:  Most people have never even seen a brown tulip, let alone grown one. Here’s your chance! 18th-century ‘Absalon’ is intriguingly patterned with swirling flames of dark chocolate and chestnut brown on gold. It’s a true broken tulip, a Dutch Bizarre from the Hortus Bulborum – and sure to cause a buzz. 16” late, zones 4b-7a, from Holland. Chart to compare.
TU73   Add to basket:   1/$9.50   3/$26.00   5/$41   10/$76   25/$171   Link to basket:
http://www.oldhousegardens.com/basket.asp?qpr=1/9.50&act=Add&pp=TU73

Forex trading between currencies like the USD/EUR/JPY trades millions of times per second.  What's needed is more participants volume in the bitcoin exchanges to reduce volatility and narrow the spreads. We will get there.

yes...  though it appeared not to be expensive, they want to have their own auditors at flexcoin's cost audit the system...   I have to debate that as the audit appears to cost thousands of dollars prior to buying the insurance policy...

I agree though and I might proceed.

It was great meeting you guys!

I have a feeling a good chunk of us actually agree with you, but the mantra of "stability so that bitcoin can become a viable currency" has been brandied about for so long in this community that it has become almost an article of faith.

The fact is, bitcoin implies a paradigm shift, and one of the paradigms that has to go is the necessity for a currency to be stable... in a world where a price can be changed several hundred times a second, that simply isn't the case.

I personally see Bitcoin as being most useful as a 'reserve currency' of sorts.  I think it would be most useful as backing for a myriad of alternative currencies each with different inflationary properties, transaction fees, etc.

The alternative currencies would compete with one another and win or lose based on the usefulness to the users, and exchanges can easily keep track of things.  The bitcoin backing the alternatives would rise or fall in value accordingly.  This would produce a situation where the holders of the backing currency would be induced to use it in a way which benefits the users as well.

I believe that we are approaching the end-of-life of our current debt-based monetary systems and for a probably brief transition period will have a non-debt-based currency. Relative to Gold, I prefer bitcoin in the role of a reserve currency.  The reason why is that if the reserve currency is abused to huge degree, and it is bitcoin, a majority of real users can render it useless by updating their software.  This cannot be said for Gold which is inevitably hoarded and abused (and very difficult to shake out of the hands of abusers.)

These are, of course, my own personal thoughts on Bitcoin at the present time.  I realize that they do not match the thoughts of others.  I did not formulate or develop the Bitcoin solution.  But then neither did almost any of you.

I just sent my friend in Dubai $50 worth of value. After clicking "send" I went to pee, and upon my return he had confirmed receipt of payment. Zero fees.

The deflation argument again reshufled. I really think that these people get a lot of hits (and thus ad money) by trashing Bitcoin and that is why they do it.

That implies bitcoin currently has real value instead of speculativity driven value.

Precisely... I venture to say that if there were only ever going to be 21 million tulips in the world, that you could not ever forge a tulip, and that you could send them instantaneously around the world... tulips would still be worth a whole shipload of money 

Let's assume for a second that the author's thesis is true - that people won't spend Bitcoins on day to day transactions. That's fine... a successful medium of exchange doesn't need to necessarily be used in such a way. Gold is a great example. It's not used ever in day to day trade, yet it's the most reliable and successful form of money in history.

The author misses that vast benefits of this technology exist regardless of day to day use. For example, the international remittance market. Even if the only long-term use of Bitcoin was for international money transfers, it would be enormously valuable. The Mexican immigrant in the US can transfer money to an exchange in his home country for a fraction of the cost of what he would pay with dollars and bank systems today (and the transfer could be done in 5 minutes, instead of 3-10 days). There is no need for him to be buying food and gas with Bitcoin for there to be value in the international transfer of funds. All that's required is a relatively stable exchange rate, and this will stabilize over time as the market grows and decides the value of Bitcoins. There have already been days where BTC was less volatile in percentage terms than the USD. Consider that in an efficient market, the immigrant's USD could be sold at the exchange in Denver, then transferred via Bitcoin to Mexico City, and then converted to Pesos at the Mexican exchange in the span of a few minutes (using trusted "green addresses") - in such a case even volatile exchange rates are not a big deal.

"Hoarding" of Bitcoin may perhaps be a hindrance to daily use, but daily use is but a fraction of Bitcoin's potential value.

I respectfully disagree. The key to adoption in large numbers will be at least a perceived notion that bitcoin's value will rise. This obsession with stability is very misguided. Nobody has a true incentive to engage with a perfectly stable currency or commodity of any sort.

A steady, continuous rise in price, on the other hand, will act as a constant lure to people to engage with bitcoins, learn about them, then buy some... once people HAVE bitcoins, they will start to use them in transactions. Not the other way around.

Of all the incentives bitcoin has to offer to the masses out there, it is its deflationary nature that will appeal to most. The uncounterfeitable aspects of it, the fact that it's decentralised and can be transmitted around the world almost instantly for almost no fee at all... that doesn't come close to acting as an incentive for the vast majority of people. A rise in value will.

Oh, and if you truly compare it with tulips, you haven't read enough about either bitcoins or tulips... which I'm sure is not the case, so let's not make silly comparisons, shall we?

Cheers

I posted a comment on that article.  With the innovation that companies like flexcoin and bit-pay are doing, the exchange risk is completely isolated from the merchant.  People use this as a savings or spending account at a bank, but with more control than you have with a traditional bank.

BTW I created an account with you.  Did you get any quotes on that policy we talked about?

One more for good measure:

Bitcoin's Deflationary Economy Not A Problem In Itself
http://falkvinge.net/2011/08/21/bitcoins-deflationary-economy-not-a-problem-in-itself/