What you can do with a bitcoin if the USD exchange price dropped to 0 - page 2.

n8rwJeTt8TrrLKPa55eU

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Quote from: goldlyre on February 24, 2013, 03:44:26 AM

I assure you that Bitcoin's exchange rate against dollar shall never drop to zero because my fund of 210 bucks shall always be there to hold it. Even there emerged a bad guy in the future who does being able to create another lumpsum of 21 million fresh coins, I'll be very gladly to allocate another 210 bucks to buy them out. So under this calculation, bitcoin's price shall only drop to US$0.00001 at the most under the worst circumstance.

Right. At this point, Bitcoin, as the first successful implementation of a decentralized cryptocurrency, has nonzero collectible, historical, and sentimental value. Personally if all 21 million were to be dumped on the market, I would bid against goldlyre to possess them all, and I'm sure so would several others. There is definitely a nonzero floor to the price.

Specific coins or private keys (e.g. Genesis block, even if unspendable) might have even higher value as collectibles. Who here wouldn't bid at least $1 in an auction for the keys to the first Bitcoins ever mined?

markm

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Maybe a really simple algorithm such as always stand ready to buy back any bitcoins you sell, for no less than X% of what you sold them for. ?

-MarkM-

mobile4ever

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Quote from: johnyj on February 23, 2013, 11:23:28 PM

Anyway, as long as this community is here, it won't

If this community is what gives value to bitcoin, what happens if it fails? The time is getting short for a valid explanation to be brought to light on this. I think it needs to be an open source solution.

DannyHamilton

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Quote from: gopher on February 24, 2013, 07:26:07 AM

@DannyHamilton - the OP is about the use of Bitcoin if the USD exchange price dropped to 0, not about the probability of the USD price dropping to 0. Hence my hypotetical scenario describing what could happen if it dropped to 0
- snip -

Certainly, and my post pointed out three mistakes and incorrect assumptions in the OP and then went on to provide an additional example of "What you can do with bitcoin if the USD exchange price dropped to 0".

gopher

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sure, its a good analogy, it may invoke useful thoughts...

what about this one?

1. what if USD collapses to 0, because the rest of the world (miraculously) decide they head enough of this.

2. At the same time, BTC worth in other currencies sky-rockets.

3. Finally, after week-long deliberation, the US Senate declares that they could willnot be able to hadle this new cliffhanger and are ruling that they will adopt the BTC as a official USD legal tender with immediate effect.

4. Then overnight the BTC=(old)USD=1.32xEU.

5. All BTC users say bullshit, we will not allow US to adopt Bitcoin as their legal money, as such use will hugely devalue the Bitcoin.

I say "that's interesting", then reach for a fresh packet of popcorn and a new ice-cold coke-zero can from the fridge.

markm

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Okay, try a related category: what things / processes are useful yet are worth zero dollars?

Air? No, wait, cylinders of air cost more when full than empty, next...

-MarkM-

gopher

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@DannyHamilton - the OP is about the use of Bitcoin if the USD exchange price dropped to 0, not about the probability of the USD price dropping to 0. Hence my hypotetical scenario describing what could happen if it dropped to 0

I think most of the posters went on a tangent here, hence IMHO the tread lost its potential to list uses for Bitcoin in this most (albeit highly unrealistic) extreme event

Stephen Gornick

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Quote from: johnyj on February 23, 2013, 11:23:28 PM

That's what I worried, bitcoin does not have any forms of such utility, if the exchange rate drops to 0

If I hold a currency that has been made essentially worthless due to hyperinflation like Germany's Papiermark in 1923, do I really care that it still has some value as a substitute as firewood? Nearly the entire value is destroyed. That my worthless currecy is still worth 0.01% of the value that I paid for it means in my mind it was a complete and total loss. Not a 99.999% loss, but a 100% loss. What difference is it to me at that point if it were to go from being worth $0.0001 to $0.0000 ?

But since a Bitcoin's worth was greater than zero back before they could be used to buy anything (like back when Laszlo had to nearly beg for someone to take 10,000 of his BTC and in exchange send him a couple of pizzas), I think it is safe to say that bitcoins will always have value above zero, as long as the expectations about the network remain (i.e., that a 51% attack doesn't happen, and that sha256 and ecsda cryptography are not broken).

goldlyre

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I assure you that ...

oakpacific

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Quote from: markm on February 23, 2013, 11:32:02 PM

Nah, you can make unalterable timestamps with BBQcoin.

Oh wait, how difficult exactly do you need it to be for a 51% attacker to alter?

(Actually though I think people have pointed before to cheaper timestamping technologies.)

-MarkM-

Realistically, a 51% attack would only happen when the number of Bitcoin users drops to 1, that would be when it really irreversibly dies, otherwise it would be silly to even attempt such an attack, as long as you're not government/some powerful organizations whose sole purpose of involvement is to destroy Bitcoin.

markm

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Nah, you can make unalterable timestamps with BBQcoin.

Oh wait, how difficult exactly do you need it to be for a 51% attacker to alter?

(Actually though I think people have pointed before to cheaper timestamping technologies.)

-MarkM-

oakpacific

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It could be used as an unalterable and indestructible proof that some information(e.g., a certian value) is sent from one online identity to another, as long as the infrastructure is still there, fiats can't do this because there is no way you can prove the total amount of money in circulation when the money was given to you. So in case that no more exchange exists, people keeping large amount of bitcoins could still use it as a medium of exchange, or at least as a ledger.

johnyj

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Beyond Imagination

Quote from: Stephen Gornick on February 23, 2013, 08:56:27 PM

Quote from: bg002h on February 23, 2013, 06:23:29 PM

A good rough answer to that question would at least be what has historically happened to other currencies that have become worthless.

Even though they might have used the "worthless" cash for keeping the stove lit in Weimar Germany, the cash still had value > 0. Zimbabwe 100 trillion dollar notes trade for more today on eBay than when they were too "worthless" to be used any longer as currency in Zimbabwe.

That's what I worried, bitcoin does not have any forms of such utility, if the exchange rate drops to 0, then it become like any other dead cryptocurrencies

Anyway, as long as this community is here, it won't

Stephen Gornick

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Quote from: bg002h on February 23, 2013, 06:23:29 PM

A good rough answer to that question would at least be what has historically happened to other currencies that have become worthless.

Even though they might have used the "worthless" cash for keeping the stove lit in Weimar Germany, the cash still had value > 0. Zimbabwe 100 trillion dollar notes trade for more today on eBay than when they were too "worthless" to be used any longer as currency in Zimbabwe.

markm

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Quote from: johnyj on February 23, 2013, 06:38:49 PM

Quote from: markm on February 23, 2013, 05:18:52 PM

No, because the price crash will lead to a difficulty drop, which if the situation keeps going will lead to more and more coins pouring out of my magic money machine hardware. Wink

Cheap coins = great time to (re)enter the mining business!

-MarkM-

Why don't you direct your hashing power towards LTC now? Wink

I still remember the day that I0coin went online, I hashed out several blocks during the first couple of minutes, and after a day I have hundreds of coins. And then ... less and less people care about it, less and less people know about it, I don't know if the network is still there Tongue

Because for me the long term value of the bitcoins, namecoins, devcoins, groupcoins, i0coins, ixcoins and coiledcoins I get by merged-mining seems better than the short sighted attempt to grab tiny amount of high difficulty litecoins.

Plus many of the merged-mine-able coins are low difficulty enough to be vulnerable, they need more hashing not less, once ASICs arrive we will be merged-mining them all with ASICs

-MarkM-

johnyj

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Beyond Imagination

Quote from: markm on February 23, 2013, 05:18:52 PM

No, because the price crash will lead to a difficulty drop, which if the situation keeps going will lead to more and more coins pouring out of my magic money machine hardware. Wink

Cheap coins = great time to (re)enter the mining business!

-MarkM-

Why don't you direct your hashing power towards LTC now? Wink

I still remember the day that I0coin went online, I hashed out several blocks during the first couple of minutes, and after a day I have hundreds of coins. And then ... less and less people care about it, less and less people know about it, I don't know if the network is still there Tongue

bg002h

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I outlived my lifetime membership:)

A good rough answer to that question would at least be what has historically happened to other currencies that have become worthless.

markm

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No, because the price crash will lead to a difficulty drop, which if the situation keeps going will lead to more and more coins pouring out of my magic money machine hardware. Wink

Cheap coins = great time to (re)enter the mining business!

-MarkM-

johnyj

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Beyond Imagination

Quote from: hazek on February 23, 2013, 02:10:42 PM

OP:

Bitcoin is a money system with some very desirable features that allows for some points called bitcoins to be transferred to anyone, anywhere in the world anytime with practically no chance of fraud via chargebacks, currency debasement or having your bitcoins get blocked or frozen and this doesn't stop being true if these points have no value, so to answer your OP question: The same thing thing as you can do with it now.

If there are many true believers like you then this is out of question, but I doubt how many

Let's change the question: If by some reason the supply of bitcoin were doubled every several year, do you still buy bitcoin when the price crashed?

edd

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Quote from: mobile4ever on February 23, 2013, 02:42:16 PM

Quote from: Monster Tent on February 23, 2013, 06:00:57 AM

What can you do with your fiat when the government calls a "bank holliday" and devalues your money to 0 ?

If you dont have a card and no checks that happens every Sunday in the Western World.

Cash still works.

Topic: What you can do with a bitcoin if the USD exchange price dropped to 0 - page 2. (Read 4135 times)