In every system sooner or later stability is reached.
That seems to be categorically false.
Maybe you mean 'every closed system' but bitcoin is hardly a closed system and is not designed to be one in any way.
Topic: Why do people think one Bitcoin will be worth $1000 (or more) - page 2. (Read 15384 times)
That seems to be categorically false.
Maybe you mean 'every closed system' but bitcoin is hardly a closed system and is not designed to be one in any way.
One thing about the whole tulip story that just doesn't make sense:
To create tulip bulbs you just plant bulbs in favourable soil and environment and 1 year later you dig it up to find many more new bulblets, replant in larger trays and so on. why the fuck would people enter a speculation frenzy on such an easily duplicated item?
BTC is completely different it has proof of work, getting increasingly harder. Ecenomically it is the same as gold. But unlike gold you dont have to stripmine the earth to get it.
BTC doubters can bite my shiny metal ASS!
To create tulip bulbs you just plant bulbs in favourable soil and environment and 1 year later you dig it up to find many more new bulblets, replant in larger trays and so on. why the fuck would people enter a speculation frenzy on such an easily duplicated item?
BTC is completely different it has proof of work, getting increasingly harder. Ecenomically it is the same as gold. But unlike gold you dont have to stripmine the earth to get it.
BTC doubters can bite my shiny metal ASS!
The story doesn't make any sense because the story is wrong. There was no tulip mania bubble. The price went up 30x because the law changed so that "buyers" did not have to complete if the price fell. They just had to pay a 3% fee to the seller. So sellers just raised their prices 30x to compensate. It's all in Wiki.
It was all future trading. In a bad way. Which has been proven to be bad many times. There is place for futures, but missuse of them leads to bubbles...
One thing about the whole tulip story that just doesn't make sense:
To create tulip bulbs you just plant bulbs in favourable soil and environment and 1 year later you dig it up to find many more new bulblets, replant in larger trays and so on. why the fuck would people enter a speculation frenzy on such an easily duplicated item?
BTC is completely different it has proof of work, getting increasingly harder. Ecenomically it is the same as gold. But unlike gold you dont have to stripmine the earth to get it.
BTC doubters can bite my shiny metal ASS!
To create tulip bulbs you just plant bulbs in favourable soil and environment and 1 year later you dig it up to find many more new bulblets, replant in larger trays and so on. why the fuck would people enter a speculation frenzy on such an easily duplicated item?
BTC is completely different it has proof of work, getting increasingly harder. Ecenomically it is the same as gold. But unlike gold you dont have to stripmine the earth to get it.
BTC doubters can bite my shiny metal ASS!
The story doesn't make any sense because the story is wrong. There was no tulip mania bubble. The price went up 30x because the law changed so that "buyers" did not have to complete if the price fell. They just had to pay a 3% fee to the seller. So sellers just raised their prices 30x to compensate. It's all in Wiki.
...you're wrong in each point by the way. You can buy pizza with Bitcoin and BitPay just figured out how to provide service for sellers with goods in an amazon warehouse.
I am at Olivia Plaza Hotel, Barcelona, Spain at the moment.
I have 12BTC in a wallet on my smartphone.
I am hungry and want a pizza.
Question for you: What do I do now?
Send me the 12BTC, and I will make sure a pizza of your choice is delivered. I will throw in a free bottle of wine.
lol .... and a taxi driver for the day.
...you're wrong in each point by the way. You can buy pizza with Bitcoin and BitPay just figured out how to provide service for sellers with goods in an amazon warehouse.
I am at Olivia Plaza Hotel, Barcelona, Spain at the moment.
I have 12BTC in a wallet on my smartphone.
I am hungry and want a pizza.
Question for you: What do I do now?
Send me the 12BTC, and I will make sure a pizza of your choice is delivered. I will throw in a free bottle of wine.
What he said, I'll make 2 pizza's
In every system sooner or later stability is reached.
That seems to be categorically false.
Maybe you mean 'every closed system' but bitcoin is hardly a closed system and is not designed to be one in any way.
People not familiar with Bitcoin don't see a difference. They say that anyone can start a new type of coin tomorrow. When you try to explain how it is difficult to gain traction for a new type of coin they just look at you funny.
I'm sure that if you're the US or the EU you could create a new coin and give it enormous traction. I expect that is coming: StateCoin. StateCoin will have many advantages. It wont be anonymous, so criminals wont be able to use it to do bad things to children. Even better, StateCoin will support remote confiscation, so the financial police will be able to get your money back if it is stolen. StateCoin will integrate smoothly with the banking system, with your cellphone account, with government welfare agencies, and of course with the tax office. StateCoin will remove the need to carry dirty, inconvenient cash. In fact cash will be phased out.
In every system sooner or later stability is reached. Even in those systems that look and seem chaotic there is some sort of stability. Likewise, Bitcoin will reach stability and will settle down on a certain value. Honestly, I don't believe anyone can now predict accurately what the stable value of Bitcoin will be. It could be $1,000 per BTC or it could be 10 cents. The fact that Bitcoin is divisible will not affect the price. Gold is divisible too but this fact does not change its value. What affects value, though, is the supply and demand. And in this respect, Bitcoin is perfectly protected. No matter how powerful mining hardware hits the market, this won't have considerable impact. Only smaller miners will see the effect - sharks will eat 'em. That's why I think it's better to trade to make profits than to mine unless you have really good hardware.
Sorry, but it is not technically correct to compare Bitcoin to tulip bubble either. That was a totally different economic story with totally different characteristics. I would not go deeply into economic detailes. One of the many things that was different is that today we live with (almost) perfect information. When tulips crashed, it would take many days before all "participants" could be notified. However, in our era, information flow is almost instant and thus market reaction is very quick.
All in all, I believe that Bitcoin does have bright future.
Sorry, but it is not technically correct to compare Bitcoin to tulip bubble either. That was a totally different economic story with totally different characteristics. I would not go deeply into economic detailes. One of the many things that was different is that today we live with (almost) perfect information. When tulips crashed, it would take many days before all "participants" could be notified. However, in our era, information flow is almost instant and thus market reaction is very quick.
All in all, I believe that Bitcoin does have bright future.
I think many people (newbies) think the value of Bitcoins can only go up is because they know there will never be more than 21 Millions Bitcoins on this planet. Bitcoins are scarce compared to the 7 billion humans on this planet or the trillions and trillions of USD and EURO in the financial markets.
What they forget is that you can, almost indefinitely, divide a Bitcoin. In milli-Bitcoins (mBTC), micro-Bitcoins (µBTC) - or Satoshis (0.00000001 BTC). So there’s plenty of Bitcoins left for everyone on this planet. Or Satoshis (300,000 Satoshi for every human to be exact).
As long as Bitcoins are not used in "real life" (e.g. I can buy stuff from Amazon or pay a pizza with them) they have zero value. OK one could say they have at least the value of the electricity that has been used to create them.
But on the other hand no one measures the value of a 100 Dollar note with the paper and the ink that it's composed of. A 100 Dollar note has it's "value" because it's accepted everywhere and I can get "stuff" for it.
Bitcoins are accepted almost nowhere – hence their "value" is pure from speculation. It can be 50cent today, 50 USD in a month and 10cent in two month. No one should complain if he has lost money. We have all seen this before. In the 17th century in the Netherlands: The Tulip Mania.
http://en.wikipedia.org/wiki/Tulip_mania
This was a period in the Dutch Golden Age during which contract prices for bulbs of the recently introduced tulip reached extraordinarily high levels and then suddenly collapsed. The price of tulips skyrocketed because of speculation in tulip futures among people who never saw the bulbs. At the peak of tulip mania, in February 1637, some single tulip bulbs sold for more than 10 times the annual income of a skilled craftsman.
What they forget is that you can, almost indefinitely, divide a Bitcoin. In milli-Bitcoins (mBTC), micro-Bitcoins (µBTC) - or Satoshis (0.00000001 BTC). So there’s plenty of Bitcoins left for everyone on this planet. Or Satoshis (300,000 Satoshi for every human to be exact).
As long as Bitcoins are not used in "real life" (e.g. I can buy stuff from Amazon or pay a pizza with them) they have zero value. OK one could say they have at least the value of the electricity that has been used to create them.
But on the other hand no one measures the value of a 100 Dollar note with the paper and the ink that it's composed of. A 100 Dollar note has it's "value" because it's accepted everywhere and I can get "stuff" for it.
Bitcoins are accepted almost nowhere – hence their "value" is pure from speculation. It can be 50cent today, 50 USD in a month and 10cent in two month. No one should complain if he has lost money. We have all seen this before. In the 17th century in the Netherlands: The Tulip Mania.
http://en.wikipedia.org/wiki/Tulip_mania
This was a period in the Dutch Golden Age during which contract prices for bulbs of the recently introduced tulip reached extraordinarily high levels and then suddenly collapsed. The price of tulips skyrocketed because of speculation in tulip futures among people who never saw the bulbs. At the peak of tulip mania, in February 1637, some single tulip bulbs sold for more than 10 times the annual income of a skilled craftsman.
The more I read OP, he does not understand people are trading in fiat for BTC, this alone back bicoin. I don't mine, I swap fiat for bitcoin think about it.
I think the actual story with the tulips was that the beautifull new color combinations were caused by some virus. And of course it was these new patterns that people went gaga over.
You never knew what pattern would grow out of any particular bulb so cultivation was impossible.
So there was a risk involved in buying a bulb and so speculation began.
You never knew what pattern would grow out of any particular bulb so cultivation was impossible.
So there was a risk involved in buying a bulb and so speculation began.
Interesting, thanks, just did some reading on the whole debacle on wiki. didn't last long and saw spot increasing to only ~20* normal:
the virus as well as producing nice color variation also degraded bulbs viability and so duplication was difficult. one thing that gets me is that tulips only flower for 1 week per year!?
p.s. nice avatar, i saw it after i uploaded mine, honest!
To create tulip bulbs you just plant bulbs in favourable soil and environment and 1 year later you dig it up to find many more new bulblets, replant in larger trays and so on. why the fuck would people enter a speculation frenzy on such an easily duplicated item?
BTC is completely different ...
People not familiar with Bitcoin don't see a difference. They say that anyone can start a new type of coin tomorrow. When you try to explain how it is difficult to gain traction for a new type of coin they just look at you funny.
I'm more worried about if the community can keep that traction. It's really hard to say where will bitcoin go, in my mind the current situation of development isn't acceptable for wide scale use. On other hand it does have downfalls, possibility of getting multiple soft-forks if the communications detoriate and some areas get isolated.
I think gold is over-valued, but it does have some practical uses.
One thing about the whole tulip story that just doesn't make sense:
To create tulip bulbs you just plant bulbs in favourable soil and environment and 1 year later you dig it up to find many more new bulblets, replant in larger trays and so on. why the fuck would people enter a speculation frenzy on such an easily duplicated item?
BTC is completely different it has proof of work, getting increasingly harder. Ecenomically it is the same as gold. But unlike gold you dont have to stripmine the earth to get it.
BTC doubters can bite my shiny metal ASS!
To create tulip bulbs you just plant bulbs in favourable soil and environment and 1 year later you dig it up to find many more new bulblets, replant in larger trays and so on. why the fuck would people enter a speculation frenzy on such an easily duplicated item?
BTC is completely different it has proof of work, getting increasingly harder. Ecenomically it is the same as gold. But unlike gold you dont have to stripmine the earth to get it.
BTC doubters can bite my shiny metal ASS!
I think the actual story with the tulips was that the beautifull new color combinations were caused by some virus. And of course it was these new patterns that people went gaga over.
You never knew what pattern would grow out of any particular bulb so cultivation was impossible.
So there was a risk involved in buying a bulb and so speculation began.
One thing about the whole tulip story that just doesn't make sense:
To create tulip bulbs you just plant bulbs in favourable soil and environment and 1 year later you dig it up to find many more new bulblets, replant in larger trays and so on. why the fuck would people enter a speculation frenzy on such an easily duplicated item?
BTC is completely different it has proof of work, getting increasingly harder. Ecenomically it is the same as gold. But unlike gold you dont have to stripmine the earth to get it.
BTC doubters can bite my shiny metal ASS!
To create tulip bulbs you just plant bulbs in favourable soil and environment and 1 year later you dig it up to find many more new bulblets, replant in larger trays and so on. why the fuck would people enter a speculation frenzy on such an easily duplicated item?
BTC is completely different it has proof of work, getting increasingly harder. Ecenomically it is the same as gold. But unlike gold you dont have to stripmine the earth to get it.
BTC doubters can bite my shiny metal ASS!
+1
You can probably discount Bitcoin denominated credit since it is asset backed and the number of Bitcoins is not increased unless a secondary market of Bitcoin IOUs is created. In that case it would have to trade at a discount
This is a very interesting point. The day bitcoin IOUs are created and bitcoin M3 (including those IOUs) surpasses actual bitcoins in circulation, it will be a great day to buy and hold bitcoins. This is because:1) it will mean that bitcoin will be a fully established currency system, with a fully functioning economy behind it.
2) if and when an asset bubble develops based on cheap bitcoin credit (these IOUs), and this bubble bursts, there will be no way of creating new bitcoins to reinflate the bubble (as has been the case with all asset bubbles created by fiat currencies credit expansion). In that case the value of bitcoins will rise significantly.
I don't think we are anywhere near such a credit system based on BTC IOUs, but if we were I would see it as positive, not negative, for bitcoins.
One thing about the whole tulip story that just doesn't make sense:
To create tulip bulbs you just plant bulbs in favourable soil and environment and 1 year later you dig it up to find many more new bulblets, replant in larger trays and so on. why the fuck would people enter a speculation frenzy on such an easily duplicated item?
BTC is completely different it has proof of work, getting increasingly harder. Ecenomically it is the same as gold. But unlike gold you dont have to stripmine the earth to get it.
BTC doubters can bite my shiny metal ASS!
To create tulip bulbs you just plant bulbs in favourable soil and environment and 1 year later you dig it up to find many more new bulblets, replant in larger trays and so on. why the fuck would people enter a speculation frenzy on such an easily duplicated item?
BTC is completely different it has proof of work, getting increasingly harder. Ecenomically it is the same as gold. But unlike gold you dont have to stripmine the earth to get it.
BTC doubters can bite my shiny metal ASS!
The issue with bitcoin with respect to gold is that it requires a functioning electronic society. Gold bugs will argue that it's therefore no good to protect against a full-on disaster scenario, which is true. I'd argue, however, that if you're putting significant wealth into gold to hedge that specific kind of tail risk, you ought to be putting the money into durable hard-assets that can be directly utilized in such a scenario (tools, materials, etc). Thus, bitcoin is my preferred hard-money.
I would argue that neither gold nor bitcoin is suitable for such a situation.
Gold is unsuitable because it is not available everywhere and in enough quantities. Gold will only be usefull in certain locations but can slowly grow from that.
Bitcoin is unsuitable because it depends on many processes that are unique to a fully functioning society. Bitcoin is pretty power hungry, hardware hungry and communication hungry. I don't think there is a good reason for sustaining it in an early post-societal-fail situation where all resources are super scarce.
Right, that's what I said (though maybe not clearly enough).
Buy tools and supplies to hedge against the disaster scenario. Bitcoin and gold are both not very useful in such a scenario.
Buy bitcoin for long-term monetary protection. Hold gold too for that, if you want, though I see a slow downside there long-term.
The issue with bitcoin with respect to gold is that it requires a functioning electronic society. Gold bugs will argue that it's therefore no good to protect against a full-on disaster scenario, which is true. I'd argue, however, that if you're putting significant wealth into gold to hedge that specific kind of tail risk, you ought to be putting the money into durable hard-assets that can be directly utilized in such a scenario (tools, materials, etc). Thus, bitcoin is my preferred hard-money.
I would argue that neither gold nor bitcoin is suitable for such a situation.
Gold is unsuitable because it is not available everywhere and in enough quantities. Gold will only be usefull in certain locations but can slowly grow from that.
Bitcoin is unsuitable because it depends on many processes that are unique to a fully functioning society. Bitcoin is pretty power hungry, hardware hungry and communication hungry. I don't think there is a good reason for sustaining it in an early post-societal-fail situation where all resources are super scarce.
Bitcoin is a commodity.
If you're thinking of it like that, then simply acknowledge that bitcoin has the properties that gold does, but taken to their intellectual extreme. PLUS excellent transactability. There aren't many things in this world with gold's properties (eg, only a few other precious metals, really). Let's ignore bitcoin's transactional properties for the moment... Do you think there's value in something that does gold better than gold itself?
Bitcoin does share many of the characteristics of gold as a commodity, but it also shares some of the characteristics of Electricity as a commodity. Perhaps you could say Bitcoin is to gold what electricity is to coal. The value of Electricity is in its ability to transport energy and the value of Bitcoin is in its ability to provide liquidity (transport value). However, Bitcoin unlike Electricity can be stored without losing its value. This makes it durable like gold.
To be clear, by "does gold", I mean properties such as limited supply, divisibility, fungability, durability, etc... That is, all the acknowledged properties of what makes a good money.
Bitcoin is superior to gold in its divisibility and fungibility.
Durability is somewhat debatable
- Some precautions such as backups need to be taken. I am sure many of us have this handled fine, but the market as a whole perhaps not.
- Also more importantly the price of a commodity good is determined as a function of its market as a whole, thus with Bitcoin you must consider the infrastructure. I do realize it is near impossible to destroy, but even damaging it will affect its value.
Supply is also a bit debatable
- You can probably discount Bitcoin denominated credit since it is asset backed and the number of Bitcoins is not increased unless a secondary market of Bitcoin IOUs is created. In that case it would have to trade at a discount.
- Also at some point commodity substitutes can and will challenge Bitcoin, right now Bitcoin has an edge in its form of liquidity (security, portability, low overhead transactions), however given enough incentive the market will create competition. I am not saying they lose to competition or that the demand for liquidity will not outpace the supply just that it challenges this notion.
The issue with gold is that it's actually no longer a good money because in modern society, we need excellent electronic transactability.
The issue with bitcoin with respect to gold is that it requires a functioning electronic society. Gold bugs will argue that it's therefore no good to protect against a full-on disaster scenario, which is true. I'd argue, however, that if you're putting significant wealth into gold to hedge that specific kind of tail risk, you ought to be putting the money into durable hard-assets that can be directly utilized in such a scenario (tools, materials, etc). Thus, bitcoin is my preferred hard-money.
Agreed the gold bug argument falls a bit short. Also most gold bugs just think of inflation as the supply of money and don't even consider the velocity of money. Gold's physical nature is a poor hedge on the velocity of money in todays world. Clearly Bitcoin does not have this issue.
Bitcoin is a commodity.
If you're thinking of it like that, then simply acknowledge that bitcoin has the properties that gold does, but taken to their intellectual extreme. PLUS excellent transactability. There aren't many things in this world with gold's properties (eg, only a few other precious metals, really). Let's ignore bitcoin's transactional properties for the moment... Do you think there's value in something that does gold better than gold itself?
To be clear, by "does gold", I mean properties such as limited supply, divisibility, fungability, durability, etc... That is, all the acknowledged properties of what makes a good money.
The issue with gold is that it's actually no longer a good money because in modern society, we need excellent electronic transactability.
The issue with bitcoin with respect to gold is that it requires a functioning electronic society. Gold bugs will argue that it's therefore no good to protect against a full-on disaster scenario, which is true. I'd argue, however, that if you're putting significant wealth into gold to hedge that specific kind of tail risk, you ought to be putting the money into durable hard-assets that can be directly utilized in such a scenario (tools, materials, etc). Thus, bitcoin is my preferred hard-money.
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