Bitcoins

Ark_Welder

mkooo wrote: »

Tried understanding some of this thread, I don't know how I didn't know about this until recently, so has anyone invested in these bitcoins for a profit and/or is anyone considering doing so?

It's still early on in its lifetime so the prices aren't at their highest yet from what I gather.

Not investing. It's an online SimCurrency gambling game. Think of it that way and play along accordingly. Or not.

grey_gym_sock

it's not supposed to be something to invest in; it's supposed to be a medium of exchange. the recent price volatility is presumably due to speculation, and could even damage its viability as a currency if it continues.

that said, it's possible to invest/speculate in something not intended for that purpose. i'm not even remotely attracted to the idea in this case. because it looks even riskier than currency speculation between fiat currencies. there is a fair argument that some digital currency (or currencies) will become widely used, but it's not a certainty. and if it does happen, it might not be bitcoin.

grey_gym_sock

Ark_Welder wrote: »

It's an online SimCurrency gambling game.

no, it's a medium of exchange.

you can use it as a gambling game. just like you can use the stock market. or bureaux de change.

Ark_Welder

grey_gym_sock wrote: »

no, it's a medium of exchange.

It's design fails that objective, because it is designed to be deflationary. History shows that process to be a failure.

alanwsg

Some analysis from The register .....
http://www.theregister.co.uk/2013/04/15/bitcoin_bubble/

grey_gym_sock

Ark_Welder wrote: »

It's design fails that objective, because it is designed to be deflationary. History shows that process to be a failure.

well, if you now agree it's a medium of exchange, rather than an online game, and just question its design, then that's progress

in the long run, the number of bitcoins would just plateau, so it's non-inflationary rather than deflationary.

you can certainly argue that an inflationary currency is better. i'm not going to argue with you there. but perhaps the moderators could merge this thread with 1 of the threads on QE, and then you could argue with all the ppl complaining about sterling being debased by inflation

cepheus

I wonder how the cost of a Bitcoins exchange value compares with the electricity to produce one?

Bitcoin energy costs soaring

Bitcoin miners use enough electricity in one day to power 31,000 US homes.

Ark_Welder

grey_gym_sock wrote: »

well, if you now agree it's a medium of exchange, rather than an online game, and just question its design, then that's progress

On the contrary, I say that it fails the objective of being a medium of exchange.

If it is a medium of exchange, then where is the exchange? Other than into real currencies. From The Register: "For example, there's very good evidence that people are hoarding Bitcoins". Accept or reject according to taste.

grey_gym_sock wrote: »

in the long run, the number of bitcoins would just plateau, so it's non-inflationary rather than deflationary.

Once you read further than the product spin, the Bitcoin documentation accepts that it is deflationary and how this increases the value of the tokens rather than its value as a medium of exchange.

From The Register: "For example, there's very good evidence that people are hoarding Bitcoins". Why change tokens now when fewer will be required at a later date, i.e. [edit] deflationary before 2040.

Read the article back here to which cepheus linked for a description of how even a stable number of tokens can have a deflationary effect.

grey_gym_sock wrote: »

you can certainly argue that an inflationary currency is better. i'm not going to argue with you there. but perhaps the moderators could merge this thread with 1 of the threads on QE, and then you could argue with all the ppl complaining about sterling being debased by inflation

I'd be happy for the moderators to delete the thread entirely. I see this as no different to the carbon credit, land banking, boiler room share scams or ponzi schemes that are designed to trap the unwary.

grey_gym_sock

i'm sure there are ppl hoarding bitcoins. there are also ppl hoarding sterling. and ppl hoarding gold. and so on. if something that ppl hoard can't be a medium of exchange, then there is no medium of exchange (at least that i can think of).

it's fine to argue that bitcoin is a flawed digital currency, but that doesn't make it a scam of any sort.

there may also currently be a bubble. it's very difficult to come up with a sensible estimate of bitcoin's current fair value. it's right to warn ppl of the risks.

thelawnet

bitcoin isn't particularly a medium of exchange, it's a medium of money lanundering and speculation, currently the latter much more than the former.

In the future it may be a medium of exchange, but I don't think you could describe it as such at the moment.

The scam is that people are being told that it will be worth more than world GDP in the future based on wild speculation - at the moment all we know is that it is used on one narcotics website, which might not even exist a year from now, and the underlying value depends on that and little more. It's possible it could be used for all future world commerce, but then so could the Zimbabwe dollar.