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Author Topic: Bitcoin  (Read 78765 times)

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John Shaw

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Re: Bitcoin
« Reply #105 on: June 13, 2011, 05:51:35 PM »

If I offered you the equivalent of $10,000.00 in either bitcoins or gold bullion, which one would you take?




AU/AG 4 LYFE
« Last Edit: June 13, 2011, 05:57:27 PM by John Shaw »
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John Shaw

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Re: Bitcoin
« Reply #106 on: June 13, 2011, 06:14:39 PM »

Also, in an attempt to lighten the tone on this subject -

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dmgov

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Re: Bitcoin
« Reply #107 on: June 14, 2011, 04:45:42 AM »

Also, in an attempt to lighten the tone on this subject -



You read to much reddit/4chan
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Wayne

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Re: Bitcoin
« Reply #108 on: June 14, 2011, 09:29:18 AM »

For Wayne:

Just out of curiosity, how would you have recommended that the 21 million bitcoins have been initially distributed so that the system WOULDN'T be ponzi-like?

First, thanks for your answers. You have verified my primary concerns to be true.

1. Odds are high that if there is a run on bitcoins, no one is gonna be buying them and you'll probably be fucked. A point I was repeatedly trying to get at.

Quite possible. I don't know how likely it is, or how likely it is to be long-term though... it's not as if the bitcoins will vanish, or lose their utility. And even if they drop to a few cents apiece, they can still be used to send money (if you didn't have enough at that point, you'd just have to acquire more to send.)

EDIT: I realize that this would probably be little comfort for someone who had a lot of $$$ in bitcoins sitting around.

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2. The system can be abused but it is "expected" not to be. Mass abuse of the system will drive (Yes, with diminishing returns, I get it) the value of bitcoins up.

I guess I'm not sure what abuse you envision here. Market manipulations? People misusing bitcoin code on other's systems?


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3. Botnets are possible. Transactions are a measurable factor in the system that is used to determine operation of the network. Transactions can be artificially inflated.

Well, I suppose bots could increase the number of transactions (until they ran out of bitcoins for transaction fees, anyway.) But I don't see what that would accomplish. More transactions doesn't mean more bitcoins generated. The system is setup so that, regardless of number of transactions, and regardless of number of miners, one transaction block is generated every 10 minutes. And throwing more processing power at it to try to generate the blocks more quickly only results in the security difficulty increasing so that the block rate falls back down to 1 every 10 minutes.


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The number and value of bitcoins can be gamed. It is highly risky to buy bitcoins as an investment.

The value, quite possibly, although as the market expands that becomes harder and harder, since buys and sells is pretty much how one would accomplish that.

The number of bitcoins? Nope. (I'll come back to that below.)


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So we're right back to what I've been saying from point one.

Transactions yes, investment no. You seem to agree:

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I wouldn't recommend anyone keeping more than a couple hundred $$$ in bitcoins at any one time. SOME people, those who probably can't handle their own bitcoins (older folks, luddites, etc.) should probably only cash in as needed, to send money, and should cash out as soon as they receive a transfer.

Mostly.

I think MOST people shouldn't be trying to invest in it.

I would hope that MOST investments are something along the lines of buying enough to be able to satisfy cash-for-bitcoin exchanges, where money is made on the conversion fees, not the actual value of the bitcoins. Bitcoins are IMHO a poor long-term store of value.

I personally can understand some level of outright speculation, considering how much they've risen (and I feel they very well could rise much, much higher in price.) But I would hope only a few people are doing that, or that those who are are doing it with very little money, because there are so many unknowns here, and so much risk, that it's definitely NOT worth, say, sinking one's entire life savings into it (I'm sorry, but having seen that article where someone did that almost made me ill.) Not even a large fraction of one's savings, for that matter.

Quote
Now, back to your original question - "Just out of curiosity, how would you have recommended that the 21 million bitcoins have been initially distributed so that the system WOULDN'T be ponzi-like?"

I think the better question is "What happens when 21 million is reached?" and I think we both know that the answer, if bitcoin is still running, will be "The cap will be increased, just like any other fiat money." Setting an arbitrary number is just setting an arbitrary number. Artificial scarcity doesn't work.

Hmm.

You know, I jumped at the concept of bitcoins so quickly, and familiarized myself with how it works so soon afterwards, that I guess I didn't realize folks might doubt the rigidity of the 21-million-bitcoin cap.

The way the system is designed, the generation of extra bitcoins beyond the cap is so unbelievably unlikely, and so enormously impractical, that I personally deem it impossible. Again though, me just saying that probably isn't enough. Perhaps an analogy will help:

Suppose you're using torrents for years, and are familiar with how they work. Suppose that suddenly you hear of someone... could be Joe Shmoe, could be Bill Gates... announcing that they're going to release a new torrents client. They claim that it'll offer you faster download speeds initially, but admit that after a week you'll probably be down to speeds less than you get now, and that the speeds will continue to decline perpetually thereafter. Oh, and the client will be totally incompatible with current torrents.

Who would actually want to download such a thing? Would you? If you did, and found only a handful of other people using it, even long after a week into the release, what would be your first step? Would you find it reasonable to believe that a large portion of torrent users would jump on board?

Even if that, by some miracle DID happen, consider the incompatibility: assuming you kept your "normal" torrent client, how big of an impact do you think having a chunk of torrent users switch would have on you? A big enough impact for you to switch to the perpetually-slowing-down client, with a smaller user-base?

That's how it would be for someone to try to undercut the system by introduce a higher cap into the bitcoin protocol. Considering the number is hardwired into the clients (as well as the math of the system), that the clients are open-source, and that anyone who did try to break the cap would have their transactions rejected by everyone else, you'd have an easier time trying to get rich somehow by convincing the mass of casual computer users to switch from Windows to Linux. I just don't see it happening. I do see people trying Bitcoin 2, Localcoin, Inflate-a-coin, etc. But not affecting bitcoin in any significant way.
« Last Edit: June 14, 2011, 09:38:38 AM by Wayne »
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"Buy low, sell high." Are YOU stocking up on silver yet?

Wayne

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Re: Bitcoin
« Reply #109 on: June 14, 2011, 09:36:36 AM »

Anyone can answer this....

If I offered you the equivalent of $10,000.00 in either bitcoins or gold bullion, which one would you take?

Gold. Of all possible opportunities that size where gold was an option, I'd only hesitate if the choice was between gold and silver.
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alaric89

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Re: Bitcoin
« Reply #110 on: June 14, 2011, 12:45:02 PM »

Having all of ones wealth stored in easily confiscated hard assets wouldn't be a very good idea right now. I don't have any better ideas though.
What little money I have to invest, I am investing in equipment, tools, and raw materials of different types.

Turd Ferguson

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Re: Bitcoin
« Reply #111 on: June 14, 2011, 01:40:38 PM »

By the time a government gets to the point where they are talking about asset confiscation, they are already to the point where they dont even have the manpower to to go around enforcing it.

Historically thats been the case and something tells me that the US govt woudln't have the foresight to try something like this until its too late to do actually do it.

I dont know man, I'm not too worried about it.

If it ever got to the point where there was even a hint of that starting to happen, I'd be burrying the shit in the woods somewhere.
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sillyperson

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Re: Bitcoin
« Reply #112 on: June 14, 2011, 01:42:35 PM »

Having all of ones wealth stored in easily confiscated hard assets
WTF are you talking about?

Physical Au is not easily confiscated. It's a high enough store of value in a small enough place, a little creativity can store a hell of a lot of value around even a small apartment in ways that even a determined thief will be hard-pressed to find.

Mining stocks, ETFs, shares of companies in BRIC countries... yeah, those assets the gubmint might swipe. But theyre never, ever going to notice that the water filter in the fridge doesn't function for a reason....

dalebert

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Re: Bitcoin
« Reply #113 on: June 14, 2011, 02:11:12 PM »

But theyre never, ever going to notice that the water filter in the fridge doesn't function for a reason....

They've learned to do really intrusive searches from drug raids and the like and I doubt they'd be fooled by clever hiding places, but they have to have a good reason to spend that much manpower on someone.  It's not the kind of thing they can do on a wide scale for a mass confiscation.

Turd Ferguson

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Re: Bitcoin
« Reply #114 on: June 14, 2011, 02:23:06 PM »

Theres always this.............


[youtube]http://www.youtube.com/watch?v=xkk6gE0s3ts[/youtube]
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alaric89

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Re: Bitcoin
« Reply #115 on: June 14, 2011, 04:25:31 PM »

By the time a government gets to the point where they are talking about asset confiscation, they are already to the point where they dont even have the manpower to to go around enforcing it.

Historically thats been the case and something tells me that the US govt woudln't have the foresight to try something like this until its too late to do actually do it.

I dont know man, I'm not too worried about it.

If it ever got to the point where there was even a hint of that starting to happen, I'd be burrying the shit in the woods somewhere.
I am worried after what happened to the liberty dollar. That silver will do no one any good buried with no one wanting it. I am betting the world will be like one big Cuba. So I figure one will have to be able to adapt quickly and be a jack of all trades criminal  to make it.
Or maybe the government will just say "Oh.... kay... everybody looks like we were wrong. Our bad sorry. We will now allow competing currencies and repeal all prohibition laws. All federal employee pentions are null and void and all schools are privatised." Then silver will be completely swell, til a disgruntled postal worker wants it.

Having all of ones wealth stored in easily confiscated hard assets
WTF are you talking about?

Physical Au is not easily confiscated. It's a high enough store of value in a small enough place, a little creativity can store a hell of a lot of value around even a small apartment in ways that even a determined thief will be hard-pressed to find.

Mining stocks, ETFs, shares of companies in BRIC countries... yeah, those assets the gubmint might swipe. But theyre never, ever going to notice that the water filter in the fridge doesn't function for a reason....
Oh for crying out loud.http://en.wikipedia.org/wiki/Gold_confiscation
And don't you remember this movie?http://www.imdb.com/title/tt0066728/ When they couldn't do anything with the gold because it still wasn't leagal to own it?

The folks who will take your swag are evil, not dumb. They are good at going after independent personalities. For example something so simple as moonshining has few people trying to do it because the statists can take all your shit if they catch you with a still. If SHTF things occur, and I would say, in a world where people contemplate charging 5 year olds for murder and everyone who trades can be legally called a terrorist, the fat lady is about to sing on that one, no one will except silver out of fear. Then it's no fucking good.
This thread is about bitcoins and right now it looks as good as anything else. It has its pluses and minuses but if it can get you things, leagal and not, around the world, its not much worse than anything else.
Full discloser I own some silver (junk dimes I bought in the 80's) and I own no bitcoins.

dalebert

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Re: Bitcoin
« Reply #116 on: June 14, 2011, 05:32:29 PM »

I'm pointedly posting this here even before I've watched it so that it won't be taken as either an endorsement or a criticism of whatever is said in it.  It is merely relevant to this thread.

[youtube]http://www.youtube.com/watch?v=pcchQs2YDZ0[/youtube]
http://www.youtube.com/watch?v=pcchQs2YDZ0

John Shaw

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Re: Bitcoin
« Reply #117 on: June 14, 2011, 08:24:09 PM »

I hope Stef doesn't get fucked, either.
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Re: Bitcoin
« Reply #118 on: June 14, 2011, 08:38:21 PM »

Looks like Mr. Stef drank the kool-aide

dalebert

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Re: Bitcoin
« Reply #119 on: June 14, 2011, 08:56:29 PM »

There's also this, but it's long and I doubt anyone will watch it.

[youtube]http://www.youtube.com/watch?v=ygoqDBfjimM[/youtube]
http://www.youtube.com/watch?v=ygoqDBfjimM
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