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Topic: The economic model behind Bitcoin is flawed - page 10. (Read 14062 times)

member
Activity: 108
Merit: 10
December 06, 2015, 12:58:01 PM

Furthermore, if you decide to set the price for your services in your currency high enough (so as to at least cover your expenses) given the settled market exchange rate for your coin, you will be losing anyway. Why? Because the profitability of mining is essentially limited by the cost of electricity, while your costs (not even speaking about profits) will obviously be higher than the cost of electricity (since they most likely will include it plus a lot of additional expenses)...

So whatever price tag you set for your services, you will be heavily losing as compared to just selling them directly for fiat

As i understand you right... It's the question about market liquidity. The more services will use the currency the more we can sell on exchange without significant price change. There is no profit now yep, just fun Grin.

Nope... In fact, I assumed that there is already enough liquidity in the market ("given the settled market exchange rate for your coin"). This is a shaky assumption (in reality things would be worse for you), but it was necessary to show why you will most certainly lose profits or just suffer losses even in the case when the exchange rate was fixed. Liquidity won't prevent you from subsidizing your users (if they pay for your services in your coin)...

Unless you cap the amount of coins allowed to be mined, indeed. Otherwise users will steal from you arbitraging the system

1. You are right if there would be just we, users and our services (like twitter, dropbox, hosting, etc). But as i said that end-user services aren't primary target, it was just part of the explanation why now it's more interesting for service owners.
2. That services won't be twitter, dropbox, etc things requires data-center.
3. In general there will be still some point where i can get profit anyway (like mining litecoin for example) so the whole assumption is not very solid imho.
legendary
Activity: 3514
Merit: 1280
English ⬄ Russian Translation Services
December 06, 2015, 12:23:31 PM

Furthermore, if you decide to set the price for your services in your currency high enough (so as to at least cover your expenses) given the settled market exchange rate for your coin, you will be losing anyway. Why? Because the profitability of mining is essentially limited by the cost of electricity, while your costs (not even speaking about profits) will obviously be higher than the cost of electricity (since they most likely will include it plus a lot of additional expenses)...

So whatever price tag you set for your services, you will be heavily losing as compared to just selling them directly for fiat

As i understand you right... It's the question about market liquidity. The more services will use the currency the more we can sell on exchange without significant price change. There is no profit now yep, just fun Grin.

Nope... In fact, I assumed that there is already enough liquidity in the market ("given the settled market exchange rate for your coin"). This is a shaky assumption (in reality things would be worse for you), but it was necessary to show why you will most certainly lose profits or just suffer losses even in the case when the exchange rate was fixed. Liquidity won't prevent you from subsidizing your users (if they pay for your services in your coin)...

Unless you cap the amount of coins allowed to be mined, indeed. Otherwise users will steal from you arbitraging the system
member
Activity: 108
Merit: 10
December 06, 2015, 12:07:55 PM

Furthermore, if you decide to set the price for your services in your currency high enough (so as to at least cover your expenses) given the settled market exchange rate for your coin, you will be losing anyway. Why? Because the profitability of mining is essentially limited by the cost of electricity, while your costs (not even speaking about profits) will obviously be higher than the cost of electricity (since they most likely will include it plus a lot of additional expenses)...

So whatever price tag you set for your services, you will be heavily losing as compared to just selling them directly for fiat

As i understand you right... It's the question about market liquidity. The more services will use the currency the more we can sell on exchange without significant price change. There is no profit now yep, just fun Grin.
legendary
Activity: 3514
Merit: 1280
English ⬄ Russian Translation Services
December 06, 2015, 07:12:34 AM

That's what I meant exactly, since your currency will be worth next to nothing (after it becomes too expensive to mine it). Why all the fuss with new monie if you could just accept fiat for your future "services"...

If they would be worthy, of course

Understood.

1. We don't want to depend on fiat payment systems (additional costs in many ways).
2. We don't want to be based on BTC because the whole thread above about money supply etc. Bitcoin price looks unstable (and it still is by design). Own emission scheme looked the best choice (as concept by itself too). There is a question about convenient exchange but it'll be solved in the future.

Furthermore, if you decide to set the price for your services in your currency high enough (so as to at least cover your expenses) given the settled market exchange rate for your coin, you will be losing anyway. Why? Because the profitability of mining is essentially limited by the cost of electricity, while your costs (not even speaking about profits) will obviously be higher than the cost of electricity (since they most likely will include it plus a lot of additional expenses)...

So whatever price tag you set for your services, you will be heavily losing as compared to just selling them directly for fiat
member
Activity: 108
Merit: 10
December 06, 2015, 07:04:29 AM

That's what I meant exactly, since your currency will be worth next to nothing (after it becomes too expensive to mine it). Why all the fuss with new monie if you could just accept fiat for your future "services"...

If they would be worthy, of course

Understood.

1. We don't want to depend on fiat payment systems (additional costs in many ways).
2. We don't want to be based on BTC because the whole thread above about money supply etc. Bitcoin price looks unstable (and it still is by design). Own emission scheme looked the best choice (as concept by itself and as part of some technical details like ddos protection servers). There is a question about convenient exchange but it'll be solved in the future.
legendary
Activity: 3514
Merit: 1280
English ⬄ Russian Translation Services
December 06, 2015, 06:53:28 AM
Ah, read as "yours" (usually it's the first question sry).
I guess most interested are site\service owners, as they will be able to accept some funds, and users gets after them. We'll have some end-user oriented services but it will be later.

If I got your point correctly, you are waiting when it becomes unprofitable to mine any more (i.e. after the pump-and-dump stage is over), and accept this coin as a payment for "some end-user oriented services" of yours, right?

Now it is time to actually ask what is your interest, since you will essentially be offering services for free

There has not been "pump" and that end-used services will not be soon. I'm waiting some integration review now to understand api design flaws Smiley It's useful already without any additions for "look previous post" guys. Like spam protection systems etc.

Services are not for free just for our currency.

That's what I meant exactly, since your currency will be worth next to nothing (after it becomes too expensive to mine it, i.e. not worth it). Why all the fuss with a new monie if you could just accept fiat for your future "services" and be done with that?

If they would be really worth it, of course

member
Activity: 108
Merit: 10
December 06, 2015, 06:46:43 AM
Ah, read as "yours" (usually it's the first question sry).
I guess most interested are site\service owners, as they will be able to accept some funds, and users gets after them. We'll have some end-user oriented services but it will be later.

If I got your point correctly, you are waiting when it becomes unprofitable to mine any more (i.e. after the pump-and-dump stage is over), and accept this coin as a payment for "some end-user oriented services" of yours, right?

Now it is time to actually ask what is your interest, since you will essentially be offering services for free

There has not been "pump" and will not be by design, that end-user services will not be soon. I'm waiting some integration review now to understand api design flaws Smiley It's useful already without any additions for "look previous post" guys. Like spam protection systems etc.

Services are not for free just for our currency. I din't understand the part about my interest. In the future it'll look like "tax" for miners i guess.
legendary
Activity: 3514
Merit: 1280
English ⬄ Russian Translation Services
December 06, 2015, 06:41:05 AM
Ah, read as "yours" (usually it's the first question sry).
I guess most interested are site\service owners, as they will be able to accept some funds, and users gets after them. We'll have some end-user oriented services but it will be later.

If I got your point correctly, you are waiting when it becomes unprofitable to mine any more (i.e. after the pump-and-dump stage is over), and accept this coin as a payment for "some end-user oriented services" of yours, right?

Now it is time to actually ask what is your interest, since you will essentially be offering services for free
member
Activity: 108
Merit: 10
December 06, 2015, 06:35:49 AM
Okay, you say that mining right now is more expensive than the price of the coin, no problem. But what the heck are you doing here advertising new coin if it is not profitable to mine at the moment?

Namely, where is our interest hidden?

Right now it's still profitable, as price up from 100btm/0.001 btc to 4000 now (we got public on bTalk 8 nov). I ever thought money is for trading, not for mining. We have instant (10-20s due to i2p) transactions, low fees, easy integration. We never advertise investing\saving as primary target, but it's really useful as microtransactions tool

I agree with that, but, look, if mining is still profitable, people will be mining the coin just for the purpose of converting it into fiat (BTC) later. When it finally becomes unprofitable to mine new coins, you are stuck with a shitload on new coins that nobody cares for...

Our interest is not hidden - we can print the money as it's our system.

I meant our interest, that of users, not yours (as an entity behind this coin)

Ah, read as "yours" (usually it's the first question sry).
I guess most interested are site\service owners, as they will be able to accept some funds, and users gets after them. We'll have some end-user oriented services but it will be later.

About stuck - user can buy our currency for BTC or selling some service\goods and so on. Due to exchange fees it will be ever easier to mine 1 coin than buy in somewhere so playing with any self regulations system (as our forum take a look) will work still. But generally without real life usage we are in trouble yep.
legendary
Activity: 3514
Merit: 1280
English ⬄ Russian Translation Services
December 06, 2015, 06:31:41 AM
Okay, you say that mining right now is more expensive than the price of the coin, no problem. But what the heck are you doing here advertising new coin if it is not profitable to mine at the moment?

Namely, where is our interest hidden?

Right now it's still profitable, as price up from 100btm/0.001 btc to 4000 now (we got public on bTalk 8 nov). I ever thought money is for trading, not for mining. We have instant (10-20s due to i2p) transactions, low fees, easy integration. We never advertise investing\saving as primary target, but it's really useful as microtransactions tool

I agree with that, but, look, if mining is still profitable, people will be mining the coin just for the purpose of converting it into fiat (BTC) later. When it finally becomes unprofitable to mine new coins, you are stuck with a shitload on new coins that nobody cares for...

Until it somehow becomes profitable to mine again, of course

Our interest is not hidden - we can print the money as it's our system.

I meant our interest, that of users, not yours (as an entity behind this coin)
member
Activity: 108
Merit: 10
December 06, 2015, 06:21:51 AM
Because they would want more coins? If they are worth anything, of course. If they aren't, what's the purpose of your "money" then?

You are missing the point. They can worth some value, but it doesn't mean it's more than you spend to get it. As CPU mining of Bitcoin now.

Okay, you say that mining right now is more expensive than the price of the coin, no problem. But what the heck are you doing here advertising new coin if it is not profitable to mine at the moment?

Namely, where is our interest hidden?

Right now it's still profitable, as price up from 100btm/0.001 btc to 4000 now (we got public on bTalk 8 nov), but it's not for a long time. I ever thought money is for trading, not for mining. We have instant (10-20s due to i2p) transactions, low fees, easy integration. We never advertise investing\saving as primary target, but it's really useful as microtransactions tool.

Our interest is not hidden - we can print the money as it's our system.
legendary
Activity: 3514
Merit: 1280
English ⬄ Russian Translation Services
December 06, 2015, 06:15:50 AM
Because they would want more coins? If they are worth anything, of course. If they aren't, what's the purpose of your "money" then?

You are missing the point. They can worth some value, but it doesn't mean it's more than you spend to get it. As CPU mining of Bitcoin now.

Okay, you say that mining right now is more expensive in general than the price of the coin, no problem. But what the heck are you doing here advertising new coin if it is not profitable to mine at the moment?

Namely, where is our interest hidden? Why should we care, really?
member
Activity: 108
Merit: 10
December 06, 2015, 06:08:34 AM
Because they would want more coins? If they are worth anything, of course. If they aren't, what's the purpose of your "money" then?

You are missing the point. They can worth some value, but it doesn't mean it's more than you spend to get it. As CPU mining of Bitcoin now.
legendary
Activity: 3514
Merit: 1280
English ⬄ Russian Translation Services
December 06, 2015, 05:56:46 AM
Well, i haven't checked whole 1500 altcoins, but emission differs from fiat, btc and most alts. https://bitcointalksearch.org/topic/m.13038013 here is expanded version.

In 2 words - we have constant "production cost" of 1 coin. Constant in terms of cpu time and electricity. So when economy behind requires more currency price of currency goes up, miners enable addition power to get profit, or reduce if there is no need. Mining not necessary for payment processing.

Thereby, if you have a huge inflow of new miners, the currency would hyperinflate, right?

Why would they do it? I guess there are better opportunities to use cpu than mine with rate for example 0.1$month. But price generally will have "low" price, yep. But not hyperinflation, just not profitable to mine for most on the planet Smiley

Because they would want more coins? If they are worth anything, of course. If they aren't, what's the purpose of your "money" then?
member
Activity: 108
Merit: 10
December 06, 2015, 05:52:56 AM
Hello guys. In our project (released already) we tried to resolve the problem described here by providing unlimited supply and constant mining complexity. But of course got some new instead, like centralization. Link in the signature. If anybody interested to discuss the concept i'm ready.

What is the economic (monetary) model behind your coin? Or, rather, how is it fundamentally different from a lot of other digital monies out there that have no limit on the number of coins mined?

Well, i haven't checked whole 1500 altcoins, but emission differs from fiat, btc and most alts. https://bitcointalksearch.org/topic/m.13038013 here is expanded version.

In 2 words - we have constant "production cost" of 1 coin. Constant in terms of cpu time and electricity. So when economy behind requires more currency price of currency goes up, miners enable addition power to get profit, or reduce if there is no need. Mining not necessary for payment processing.

Thereby, if you have a huge inflow of new miners, the currency would hyperinflate, right?

Why would they do it? I guess there are better opportunities to use cpu than mine with rate for example 0.1$month. But price generally will have "low" price, yep. But not hyperinflation, just not profitable to mine for most on the planet Smiley
legendary
Activity: 3514
Merit: 1280
English ⬄ Russian Translation Services
December 06, 2015, 05:49:30 AM
Hello guys. In our project (released already) we tried to resolve the problem described here by providing unlimited supply and constant mining complexity. But of course got some new instead, like centralization. Link in the signature. If anybody interested to discuss the concept i'm ready.

What is the economic (monetary) model behind your coin? Or, rather, how is it fundamentally different from a lot of other digital monies out there that have no limit on the number of coins mined?

Well, i haven't checked whole 1500 altcoins, but emission differs from fiat, btc and most alts. https://bitcointalksearch.org/topic/m.13038013 here is expanded version.

In 2 words - we have constant "production cost" of 1 coin. Constant in terms of cpu time and electricity. So when economy behind requires more currency price of currency goes up, miners enable addition power to get profit, or reduce if there is no need. Mining not necessary for payment processing.

Thereby, if you have a huge inflow of new miners, the currency would hyperinflate, right?
member
Activity: 108
Merit: 10
December 06, 2015, 05:25:34 AM
Hello guys. In our project (released already) we tried to resolve the problem described here by providing unlimited supply and constant mining complexity. But of course got some new instead, like centralization. Link in the signature. If anybody interested to discuss the concept i'm ready.

What is the economic (monetary) model behind your coin? Or, rather, how is it fundamentally different from a lot of other digital monies out there that have no limit on the number of coins mined?

Well, i haven't checked whole 1500 altcoins, but emission differs from fiat, btc and most alts. https://bitcointalksearch.org/topic/m.13038013 here is expanded version.

In 2 words - we have constant "production cost" of 1 coin. Constant in terms of cpu time and electricity. So when economy behind requires more currency price of currency goes up, miners enable addition power to get profit, or reduce if there is no need. Mining not necessary for payment processing.
legendary
Activity: 3514
Merit: 1280
English ⬄ Russian Translation Services
December 06, 2015, 05:18:54 AM
Hello guys. In our project (released already) we tried to resolve the problem described here by providing unlimited supply and constant mining complexity. But of course got some new instead, like centralization. Link in the signature. If anybody interested to discuss the concept i'm ready.

What is the economic (monetary) model behind your coin? Or, rather, how is it fundamentally different from a lot of other digital monies out there that have no limit on the number of coins mined?

How the supply of new coins is constrained and on what conditions, if ever?
member
Activity: 108
Merit: 10
December 06, 2015, 04:50:42 AM
Hello guys. In our project (released already) we tried to resolve the problem described here by providing unlimited supply and constant mining complexity. But of course got some new instead, like centralization. Link in the signature. If anybody interested to discuss the concept i'm ready.
full member
Activity: 210
Merit: 100
December 06, 2015, 01:58:03 AM
Usury is when the state uses the peoples' assets and keeps them ignorant about how to access their own value.

Could you expand more on that, namely, what you mean by accessing the value of assets? I don't get it

I am so glad that you asked. There is A LOT of misinformation surrounding this topic and the monetary system in general, so I will summarize my understanding and I hope that those who read will educate themselves enough to formulate a response.

First, you have to understand the entire context around HJR 192 and the 14th Amendment.
Second, you need to be aware of the nature of the SS Card: it is a promissory note.
Finally, you need to stand as a fiduciary over that SS account and utilize (or liquidate) that note.

Required reading:
Wizard of Oz ….The “Coded” Movie of what really happened to America
http://www.whale.to/c/wizard_of_oz1.html
HJR 192 Overview, it seems to contain some misunderstanding about "Trust" but this is a good place to start
https://iuvdeposit.wordpress.com/hjr-192/
Archive of Documents posted on the Yahoo Group "WeThePeople_Shareholders" (check Yahoo to get the latest documents; it is a work in progress)
http://econcurrent.com/devine/files/37-TreasuryAccount/
Nature of the Dollar (it may also contain misunderstanding about "Trust"):
http://thefederalmafia.homestead.com/letteronmoney.html
Nature of a Bond:
http://stopthepirates.blogspot.com/2014/03/in-order-to-win-in-court-you-have-to.html

If something is hard to understand, you will probably need to use a law dictionary; Ballantine's and Anderson's are recommended.
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