Bitcoins

Generali

The biggest problem with Bitcoin is that pretty much anyone can set up a competitor: Citcoin then Ditcoin through to Zitcoin.

At least a normal fiat currency is legal tender and can be used to pay taxes. If anyone remembers Bitcoin in 100 years time it will be viewed as an oddity.

BoracicLint

Generali wrote: »

The biggest problem with Bitcoin is that pretty much anyone can set up a competitor: Citcoin then Ditcoin through to Zitcoin.

At least a normal fiat currency is legal tender and can be used to pay taxes. If anyone remembers Bitcoin in 100 years time it will be viewed as an oddity.

They all use the same bitcoin protocol, with just some minor differences but essentially they are all the same.

I don't see that as a problem however, the success of a peer to peer currency depends on a large following, something Bitcoin has considerably more of than any of its competitors (Bitcoin has an $11B market cap vs. £700M for Litecoin, followed by $110M for Peercoin)

This might not always be the case, but Bitcoin has a massive head start and some very big investments have been made to its infrastructure.

M.Johnson_2

Generali wrote: »

The biggest problem with Bitcoin is that pretty much anyone can set up a competitor: Citcoin then Ditcoin through to Zitcoin.

At least a normal fiat currency is legal tender and can be used to pay taxes. If anyone remembers Bitcoin in 100 years time it will be viewed as an oddity.

It takes 3 days for a spotty teenager to make a competitor to bitcoin. If they make it exactly the same but only 20Million in the supply thats 1million less than bitcoin so more rare. The newer ones have faster transaction times so would be better.

This is a good point if using crypto as money in every day transactions how can you buy something or pay for something if it takes 10mins for payment to clear?

If you are in a long line they want to keep the line moving. They have to have fast transaction time just like credit cards.

BoracicLint

M.Johnson wrote: »

It takes 3 days for a spotty teenager to make a competitor to bitcoin. If they make it exactly the same but only 20Million in the supply thats 1million less than bitcoin so more rare. The newer ones have faster transaction times so would be better.

This is a good point if using crypto as money in every day transactions how can you buy something or pay for something if it takes 10mins for payment to clear?

If you are in a long line they want to keep the line moving. They have to have fast transaction time just like credit cards.

Bitcoin does not handle small transactions very well, that is true, due to the 10 minute target for blocks in the chain. However, this is where off-chain transactions come in. Merchants will likely start to accept Bitcoin transactions without verification, before submitting several transactions to the blockchain.

The biggest advantages of Bitcon lie elsewhere, like sending large quantities of money overseas for almost no fee etc

Although it is true that a new currency can be setup in 3 days, how do you get people to trust in it enough to build a network comparable to the size of Bitcoin's?

N1AK

csm888 wrote: »

This again is not true, if an asset is appreciating in value, wealth is being created.

It may be other things, but Bitcoin is not a Ponzi scheme by definition, look it up.

Absolute and utter false nonsense. Wealth is not created by bitcoins increasing in market value, though it could be argued that 'mining' them does. You clearly have no idea what wealth creation means if you can mistake it for such.

Bitcoin in a ponzi scheme, the only part of the definition that is even debatable is whether it is fraudulent or not:

A Ponzi scheme is a fraudulent investment operation that pays returns to its investors from existing capital or new capital paid by new investors, rather than from profit earned by the individual or organization running the operation. Operators of Ponzi schemes usually entice new investors by offering higher returns than other investments, in the form of short-term returns that are either abnormally high or unusually consistent. The perpetuation of the high returns requires an ever-increasing flow of money from new investors to sustain the scheme.

People who own or mine bitcoins have a huge amount to gain by ramping bitcoins, increasing the demand and thus pricing. Those people who then buy have the same incentive. Thus the cycle continues until at some stage, for one or more of various reasons demand collapses and the value crashes.

What do we see people on here constantly saying about bitcoins: "look how much they have gone up", "way better than keeping in low rate savings" etc.

JohnRo

I think what's more likely is that bitcoin will eventually absorb the alternatives by implementing any new protocol features they present as and when they become accepted as advantageous and workable.

N1AK wrote: »

Bitcoin in a ponzi scheme

All you're really saying is that you either don't know anything about bitcoin, don't know anything about ponzi schemes, or both.

M.Johnson_2

Satoshi wrote: »

Are there any laws about renting out a property for bitcoins?

If you accepted bitcoins as rent how could you work out tax?

If someone wanted to stay out of the financial/banking system that is their choice right?

this is a good interview about the CIA in bitcoins

http://dont-tread-on.me/?p=31796

It would not be breaking the law, but what would be the advantage in charging rent in bitcoins?

How would it work? Set the rent at this many bitcoins per month, or set it in Pounds and the exchange rate in bitcoins every month?

M.Johnson_2

BoracicLint wrote: »

Bitcoin does not handle small transactions very well, that is true, due to the 10 minute target for blocks in the chain. However, this is where off-chain transactions come in. Merchants will likely start to accept Bitcoin transactions without verification, before submitting several transactions to the blockchain.

The biggest advantages of Bitcon lie elsewhere, like sending large quantities of money overseas for almost no fee etc

Although it is true that a new currency can be setup in 3 days, how do you get people to trust in it enough to build a network comparable to the size of Bitcoin's?

How can you trust off-chain transactions? If I do my shopping and have an elaborate fake off chain transaction bogus set up, by the time I am half way home with the good I bought the seller realises they have been had.

I would not sell something for off chain, I would only let them take the good when the transaction has cleared. It always takes longer than 10mins in my experience.

Satoshi

M.Johnson wrote: »

It would not be breaking the law, but what would be the advantage in charging rent in bitcoins?

How would it work? Set the rent at this many bitcoins per month, or set it in Pounds and the exchange rate in bitcoins every month?

The advantage is its outside the banking system.

The latest Kiser report shows how universities are accepting bitcoins for payment for education now.

Yes the rent would be calcualted everymonth in fiat to crypto exchange rates.

BoracicLint

M.Johnson wrote: »

How can you trust off-chain transactions? If I do my shopping and have an elaborate fake off chain transaction bogus set up, by the time I am half way home with the good I bought the seller realises they have been had.

I would not sell something for off chain, I would only let them take the good when the transaction has cleared. It always takes longer than 10mins in my experience.

But even if you buy something from me off chain, I can tell that the funds have been sent to my wallet within seconds of the Bitcoin being sent. The risk is therefore only that you could have double-spent the Bitcoin. An unlikely scenario for the amounts we are talking about.

For large transactions, such as the sale of a car of property, obviously it makes sense to wait for 6 confirmations (up to a day in some cases, depending on the transaction charge) as there is more at stake.