Bitcoins

BoracicLint

Tweaker wrote: »

When you take out a loan from the bank you have to have an asset as collateral so that the bank has some hope of recovering some money if you fail to pay the loan.

Governments keep gold reserves so that in a worst case scenario should their economy go down the toilet they have something of value to pay other countries they owe money to and only on this basis will countries be willing to allow currency trading.

BitCoin has fresh air as it's collateral, buying BitCoins is no different to sticking your money on a horse race, at least the horses are tangible.

I just watched the 2nd episode of the new series of Raising Hope, this episode should be used as an idiots guide to how economies work and how they can fail, every politician should be made to watch it, just before we hang them all.

What about un-secured personal loans? Where is the collateral?

So if our economy collapsed, tell me where do I go to exchange my pound sterling for ounces of gold? If our economy collapsed, those crisp bank notes would be more valuable as firewood.

Why do you put so much faith in fiat currency?

Satoshi

csm888 wrote: »

If you think you have spotted an obvious failing of Bitcoin, the odds are you haven't.

Nakamoto wrote: »

The main thing to bear in mind is how threatened the USA and other governments are by BitCoin, the last resort they have is to let the internet be unreliable or even go off all together. That's it the end of BitCoin absolutely. The very first time the internet becomes unreliable when it next comes back on there will be a rush to sell BitCoin while its still possible, and where will all these units of currency flow into? Gold and Silver and real tangible things.

I know some say the world will go to hell if the internet is switched off but when we were all kids there was no internet. This is why BitCoin is so fragile, it can not work without reliable internet.

That would be a last resort to turn the internet off to kill bitcoin. But there are a number of situations that electric or internet may go down on its own.

Incidentally why is silver banned to be talked about but bitcoin is not?

csm888

Bitcoin is only temporarily tied to fiat because, everyone who wants to get hold of bitcoins needs fiat to either start mining or buy some on an exchange.
Bitpay has facilitated many websites to also take payment with Bitcoin, and, as the number of items available to buy increases (and people are attracted to buying things using Bitcoin because it is cheaper - no 3% CC/Paypal charges) the connection bitcoin has with fiat will be diminished. More people may get paid in Bitcoin and only use fiat for occasional transaction.


We live in a world where a large percentage of all the gold (enough to fill 2 olympic sized swimming pools in total) is stored in big vaults, and sits there for years on end. This is lunacy, a useful metal such as gold should be used not just stored away, it should be used in industry, jewellery etc etc.
Clearly Bitcoin could fix this problem. Perhaps Bitcoin will not be used for everyday transactions, but as a store of value.

The fact that few people accept Bitcoin today is meaningless in the wider context, I remember using Mosaic and then Netscape in the late 80's early 90's. The internet was just a toy and tool for universities, few could have believe what it turned into. Things change.... and Digital Currencies may well be one the bigger changes in our lifetime.

@DiggerUK, I understand you are taking a polarised view to enable the discussion, but its not black and white, you can't deny Bitcoin has several advantages over the current system. Something is going to change because of it. And because the current market value (currently $7.2 billion which makes it larger using M1 value than 1/2 the countries in the world) many people have a significant interest in ensuring if any changes are made and a digital currency is used in some way, its going to be Bitcoin or some derivative.

The world is plagued by ponzi schemes and ways to get rich quick, but not everything has to be one of these. Perhaps Bitcoin is the start of a revolutionary change to the way the worlds finances work. If you can't even accept this as a possibility.......

Satoshi

csm888 wrote: »

people are attracted to buying things using Bitcoin because it is cheaper - no 3% CC/Paypal charges).

Be great if you could sell things on ebay style website for 0.000000something bitcoins.

sabretoothtigger

dryhat wrote: »

You would need serious amounts of money to begin with to be able to do that.

£1000 and on 5% margin I can buy 20k of shares which is enough if Im correct every day to do well going ahead.

Or if not that then I dont buy the shares outright but the right to buy at a price, options. The leverage on that idea is gigantic and they issue weekly prices.

Or if you say it must be shares only then I'd just buy smaller companies in riskier sectors, some do this and gold mining shares qualify. I made 100% over the summer, because I had no certainty it wasnt an impressive gain but with hindsight I could have doubled everything, with leverage or options it gets silly quick.

I have royalities in an exchange, in real gas pipelines revenue this garners about 8% at best but in BTC it can be 100% apparently but also we might lose it all as US gov opposes any competetion. If I knew which will win of the two scenarios or just a timescale, it will make anyone a millionaire..

csm888

Satoshi wrote: »

Be great if you could sell things on ebay style website for 0.000000something bitcoins.

From you name you should know....
1 Satoshi = 0.00000001 Bitcoins

So your £2 Ebay item could be priced at 0.0055 Btc or 550000 Satoshis.

New currency divisions names could easily be adopted as required.

Satoshi

csm888 wrote: »

From you name you should know....
1 Satoshi = 0.00000001 Bitcoins

So your £2 Ebay item could be priced at 0.0055 Btc or 550000 Satoshis.

New currency divisions names could easily be adopted as required.

Is it possible to write this on an ebay item I wonder?

I may try offering a few DVDs for a few thousand Satoshi's. Then no paypal fees

Will ebay allow it? Will customers who have bitcoin want to spend them? With paypal the buyer is protected, what happens if the seller takes the bitcoin and does not send the product?

BoracicLint

Tweaker wrote: »

I wasn't citing every example, unsecured loans from banks are usually based on a persons financial track record, they don't give them to anyone who comes along and asks, ultimately for any currency to work it needs something behind it to build trust, bitcoins have nothing.

Neither did I say I had absolute faith in it, and unless you happen to actually be a country you won't see any gold from an economic collapse, gold reserves aren't for our benefit, they are to maintain economic trust between countries, not individuals.

If the founders of BitCoin decide to take the money and run, it will probably be the worlds biggest ponzi scheme to date, they are not bound by financial regulation in the UK, and probably nowhere else in the world either.

Again, Pound Sterling has nothing more behind it than Bitcoins, other than the large number of people who accept it. Pounds/Dollars are not linked to gold. Gold is simply a way in which a country can store wealth.

It is not possible for the founders to 'take the money and run'. I think you need to further your understanding of bitcoins, and cryptography. Bitcoin is open-source. Everybody can see every transaction on a publicly held ledger. The mathematics behind the ledger ensures that double-spend is impossible, and also ensures that every transaction is valid. For someone to steal my bitcoins, they would need to know my bitcoin wallet address, and my passphrase as both pieces of information form the 'inputs' to the crytographic puzzle. I only store one of these items on the internet. I could give you my wallet address and you could quite happily see how many bitcoins I have...you could never spend them though without the passhprase which was generated offline, and stored in hard copy.

Almost all the 'thefts' you've heard about, are due to peoples reliance on untrustworthy sites which store both the passphrase and the wallet online. This is where some level of regulation will be of benefit, and is one of the stumbling blocks this promising currency faces.

sabretoothtigger

paypal does not process btc, that would make news. The guy who setup paypal also did twitter and next he proposes a mobile phone based currency...

Pound Sterling has nothing more behind it than Bitcoins

They do, HMG requires sterling for taxes. It has a worth linked to sovereign demands, if taxes do rise so does sterling in theory a bit like if they raise interest rates.
We can say this is artificial but you live in the UK, they will decide what currency you will use ( to this extent) not you

csm888

Tweaker wrote: »

If the founders of BitCoin decide to take the money and run, it will probably be the worlds biggest ponzi scheme to date, they are not bound by financial regulation in the UK, and probably nowhere else in the world either.

This is impossible the inventor(s) "Satoshi Nakamoto" can't run away with Bitcoin, the Bitcoin network is not controlled by any one individual. It is a peer 2 peer system. Each person who runs a Bitcoin program on their computer becomes part of the network and helps secure it. The only way the bitcoin network can change is through changing that program. The program is open-source so anyone can see how it works and can change it if they wish. But...the Bitcoin network will only change if all the people who take part in it agree to change their copy of the software to the new version.
The programmers who are currently making minor changes to the program are the Bitcoin foundation, but if they make a change that people don't like it will be rejected by the users & miners. Its a technological democracy.

From Bitcoin Myths...
"A ponzi scheme is a zero sum game. In a ponzi scheme, early adopters can only profit at the expense of late adopters, and the late adopters always lose. Bitcoin has an expected win-win outcome. Early and present adopters profit from the rise in value as Bitcoins become better understood and in turn demanded by the public at large. All adopters benefit from the usefulness of a reliable and widely-accepted decentralized peer-to-peer currency."