Topic: Why aren't I filthy rich yet? It's been like two months. (Read 11636 times)

According to wikipedia, roughly 5.3 billion troy ounces of gold have been mined in all of human history.  Gold is currently trading at around $1600 a troy ounce which means that the total market value of all of the world's mined gold is approximately $8.5 trillion.  The demand for gold (and hence its price) is not driven entirely by its monetary usefulness because it has other uses such as jewelry and electronics.  But a non-trivial fraction of its price comes from its usefulness as money.  How big is that fraction? Let's be conservative and say it's only 25%.  That means that gold's total "money value" is around $2 trillion. Let's pretend as a simplifying assumption that all 21 million bitcoins have been mined.  The total value of those coins based on a current price of $6.40 is $134 million.  134 million is smaller than 2 trillion.  Bitcoin is supposedly a "better" money than gold when you evaluate it according to all the characteristics that make for good money, e.g., it's divisible, fungible, durable, portable, identifiable, and scarce.  And yet, (using all of the previous assumptions) if bitcoins were valued ONLY 1/1000th as much as "monetary" gold, they'd be worth a total of $2 billion, i.e. roughly $95 / BTC. If they were valued AS MUCH as monetary gold, they'd be worth $95,000 a piece. Of course, since bitcoins are at least 10 times BETTER than gold, they should really be worth no less than $950,000 each. And yet, I can't help but notice that I still live with my parents and drive an '89 Geo Metro. That raises a few questions:

1) Why aren't I filthy rich yet?
2) Any other dreamers willing to post their pie-in-the-sky, insanely bullish predictions for what a bitcoin could be worth in terms of purchasing power if it proves to be as revolutionary as we hope it will be?

AND

3) It seems like a lot of people are very focused on bitcoin's adoption by merchants, i.e. the "medium of exchange" aspect of currency, as the key to its success. But couldn't bitcoin still be insanely successful (in terms of its value) if it took off ONLY as a store of value? (And isn't that mostly how gold is used?)

I remember in class at any level (all the way through university) I was the one asking many (stupid) questions. Most people just like to keep quiet to avoid standing out I guess. Most people want to be normal. Being normal is the last thing I'd want to be.

I think most people assume that things which they don't understand are much more complicated than they really are. That puts them off doing any research into new concepts such as cryptocurrency.

I have always taken an interest in things which I don't understand. It seems like the most natural thing in the world to just 'ask Google' when you don't know something - I mean, that's what it's for, right? My friends could never understand why I spent time looking up seemingly irrelevant things on the internet, and conversely, I could never understand why they wouldn't just look it up when they didn't know about something. 

This forum consists of those people who think for themselves, ask questions, and keep an open mind.

According to wikipedia, roughly 5.3 billion troy ounces of gold have been mined in all of human history.  Gold is currently trading at around $1600 a troy ounce which means that the total market value of all of the world's mined gold is approximately $8.5 trillion.  The demand for gold (and hence its price) is not driven entirely by its monetary usefulness because it has other uses such as jewelry and electronics.  But a non-trivial fraction of its price comes from its usefulness as money.  How big is that fraction? Let's be conservative and say it's only 25%.  That means that gold's total "money value" is around $2 trillion. Let's pretend as a simplifying assumption that all 21 million bitcoins have been mined.  The total value of those coins based on a current price of $6.40 is $134 million.  134 million is smaller than 2 trillion.  Bitcoin is supposedly a "better" money than gold when you evaluate it according to all the characteristics that make for good money, e.g., it's divisible, fungible, durable, portable, identifiable, and scarce.  And yet, (using all of the previous assumptions) if bitcoins were valued ONLY 1/1000th as much as "monetary" gold, they'd be worth a total of $2 billion, i.e. roughly $95 / BTC. If they were valued AS MUCH as monetary gold, they'd be worth $95,000 a piece. Of course, since bitcoins are at least 10 times BETTER than gold, they should really be worth no less than $950,000 each. And yet, I can't help but notice that I still live with my parents and drive an '89 Geo Metro. That raises a few questions:

1) Why aren't I filthy rich yet?
2) Any other dreamers willing to post their pie-in-the-sky, insanely bullish predictions for what a bitcoin could be worth in terms of purchasing power if it proves to be as revolutionary as we hope it will be?

AND

3) It seems like a lot of people are very focused on bitcoin's adoption by merchants, i.e. the "medium of exchange" aspect of currency, as the key to its success. But couldn't bitcoin still be insanely successful (in terms of its value) if it took off ONLY as a store of value? (And isn't that mostly how gold is used?)

I've had a few friends read Erik Voorhees' introduction to Bitcoin (which btw, I think is phenomenal and you should read now if you haven't already).  http://evoorhees.blogspot.com/2012/04/bitcoin-libertarian-introduction.html

But like I said above, the responses I've gotten have been extremely skeptical.  What's really frustrating is that nobody seems to have much interest in actually challenging the argument that Bitcoin will be revolutionary.  Instead, I get the impression that they find something about the whole idea itself threatening (then again, that might be a response to the feverish look in my eyes as I explain it  ).  Most recently, when I pressed a friend for specific objections, here are the two he offered: (1) "it's too complicated; only geeks are going to be into it" and (2) "what's to stop someone else from copying the idea (or improving upon it) and coming out with 'Bytecoin'?"  I answered the first with the "internet before the invention of the web browser" analogy.  I further explained the positive feedback loop of network growth --> increased value --> increased incentive for user-friendly tools and innovations --> network growth, etc.  Re: the second objection, I explained network effects and Bitcoin's tremendous first-mover advantage. 

Of course, none of that convinced him.  Finally, his response was "well, I just don't see it happening." WTF?

^^Thanks for that comment Bitburger. Even though I'm a contrarian (because other people are often wrong) it's nice to see someone state my exact world view every once in a while.

I think most people are just lazy and scared though instead of stupid. Most things they cannot (or will not) do aren't complicated at all and everyone that isn't retarded should be able to understand it. It's just disinterest (how odd that may seem).

You and everyone else here.  Dealing with that.  You need to understand - the vast majority of the population (90%) do nothing but live day to day.  They're happy with their 9-5 jobs, their cubicles, and they're content to just "exist".  They don't explore, inquire, or think outside the box at all.  It could be lack of intelligence or laziness.  I prefer to think its an intelligence thing.  But nobody cares because they don't care about most things.  The majority of humanity are sheep, lead by the herd.  Even mister Jesus Christ said this about us, accurately.  you're not a moron, and you're not crazy.   If you have an IQ worth noting, and you've evaluated the situation fully, then you're right, and they're wrong.  Its difficult biting my tongue, and it will be difficult not shoving it in their faces later.  That's the true challenge

Ha, yeah I was serious (mostly). The problem is I go back and forth. Bitcoin really DOES seem like it has the potential to be revolutionary and MASSIVELY successful. And I sometimes think I'm a genius for understanding its implications earlier than most.  But then I remember that I'm not that smart. And I haven't exactly won over the friends and family I've tried to convert. ("Dude, you've got to drop the bitcoin sh*t. Seriously, I don't care.") And then I wonder if I'm not just a moron who spent several grand on "Mario money" (my wife's preferred term) that will soon be worthless.   I guess we'll find out. 

I don't see how that's relevant. I said I wanted to be filthy rich.  

http://www.youtube.com/watch?v=-DJtHL3NV1o

LOL, well, at what price point are you a millionaire?

and after all the debate... we are still poor 

1) Why aren't I filthy rich yet?

as someone who is 31, i agree.

"what's to stop someone else from copying the idea (or improving upon it) and coming out with 'Bytecoin'?"

*bump*

Well, that's a little better, Bitcoin. Not good. But better. Now how about we quit playing games and get serious? I don't want to end up as one of those poor schmucks who still has to work when he's 35.