Bitcoins

IzzyFreedman

I could create a currency called Izzy dollars and as long as people believed they are worth something then they are. Oh wait that already happened with bitcoins.

globalds

It is still going up ..At a pretty astronomical rate

http://preev.com/btc/gbp

As I type this it is showing £71.25 for one bitcoin.
I bought a few at £54 about a week ago ..
Someone is ramping this as it really has no great reason to be going up like this.

I have read the true value should be close to £2300 for one coin ..
I am not cool enough to hold this hot potato ..so sold once I had made my 10% ..But I think I might buy a few if a crash does happen ..depends how big the crash is ..

globalds

this is crazy ..It has gone up by £3.00 in 3 hours ..

Generali

dryhat wrote: »

I take it you're ok with the crimes the banks have comitted?

HSBC found guilty of laundering money from terrorists and drug cartels?

Barclays and others rigging libor?

The London whale?


...... and other well-documented skullduggery

How was the London Whale a crime? It was a very stupid thing to do but not illegal.

andy.m_2

I think at present Bitcoin is being traded as a desirable commodity and the value is bubbling out of control, I intend to ride the wave for a bit and jump out with a bit of profit, but isn't that against the BTC ethos?

I think there is more ramping as Europes undesirables try to extract wealth from failing economys, we've seen a 200% rise in a couple of weeks possibly due to Russian extraction from Cyprus, if say the Mafiosa decide to rid of Italian Euro then there is the potential for another fat short term rise and hence a small profit to be had.

johnhamelink

Hey folks, just registered here to respond to this thread!

There's a lot of FUD, probably brought upon by the media's rubbish portrayal of bitcoin right now.

One of the questions people on here seem to be asking is "what do the miners do when they've done all the mining". One of the things that happens in bitcoin is that whenever you transfer money, a tiny (less than 1p) transaction fee is optionally available to spend, which speeds up how quickly the transaction is confirmed. It is the job of the miners to do the checking. As more and more people use the currency, the miners can make more and more money.

One of the best things about bitcoin (and my usage of it), is it makes it very cheap to send money overseas. I'm a web developer, and I build things for people all over the world because I get a lot of my work through the internet. I also use talent from all over the world, and it costs a fortune to pay them in bank fees. Recently, I've started paying in bitcoin, and it drastically reduces fees for both parties.

Bitcoins are worth money practically, because they can be exchanged for "real" money (whatever that is). A growing amount of online retailers are accepting bitcoins, which helps move the money around. The key to making bitcoin less volatile is simply to have more people braking the coins up into smaller chunks - big fluctuations in price happen because some people have lots of coins and sit on them, then trade them all in for other currencies and flood the market with coins, so they all become worth less. If that happened more often on a smaller scale, the result would be the money worth would be less volatile.

Another thing people seem to worry about is "what is the use of a bitcoin if it's worth so much" - this is actually irrelevant in practice, as bitcoins can be split up to values that are far smaller than pounds and pennies. So even if the value of bitcoin increases by many orders of magnitude, it'll still be a practical currency to use to buy normally priced items.

Recent news has also shown that lots of people in Spain are moving their money to bitcoins because their banks aren't letting them withdraw their money. This is one of the main reasons why the cost of bitcoins has risen so sharply recently - because Spaniards are clambering to get coins and so they've created scarcity.

I'm not a bitcoin expert or anything, I just wanted to share what I've learned

Edit: Also, I really wish I'd got into bitcoins when OP posted.

lesstoinvest

I would cash in all your bitcoins for smack + weed now. Much better track record. :rotfl:

merlingrey

JohnRo wrote: »

People struggle with the whole concept of what money is and what value we bestow on it.

The idea that nothing can have any intrinsic value is intriguing. It's all about belief and trust, fantasy even.

I don't:
currency is a medium of exchange

money is everything currency is + store of value.

Currency is not money if it was it wouldn't have lost 90% of it's value in 30 years.

If currency=money i should be able to stick it under my bed for 20 years and buy the same things with it i can today.

You used to be able to do that, but only when currency was backed up by something that couldn't be printed/copied/faked.

merlingrey

The reason bitcoin will fail is the same reason World of warcraft ingame currency fails (or loses value), and any virtual videogame MMORPG currency fails because of this sort of $h1t:
http://startbitcoin.com/

Mining, mining for bitcoins, it is exactly as it sounds.

In videogames which have online digital currency players will inflate the currency supply when they get coins for progressing in the game and defeating monsters and goblins and whatnot, but it has an economy and people trade it offline for real money and buy goods ingame with it, BUT chinese farmer/miners will work round the clock to collect up as much of that currency to sell creating ingame hyperinflation.

Seen it happen.
Outside the gameworld the currency costs less and less to buy as the supply increases.

It seems amazing that a videogame would do this, but the videogame is following the reality of economic supply and demand.

The mining of bitcoins gets more difficult the more people are doing it, now this sounds great and acts as a limit on the inflation, but look deeper into it and you'll find mining speed would increase as the processing speed and computer capability increases, indicating to me that with moores law and the compounding rate of people doing it it will hyper inflate.

In simple terms there will eventually be more people trying to "earn" bitcoins for free than the number of people willing to buy them.

JohnRo

merlingrey wrote: »

In videogames which have online digital currency players will inflate the currency supply when they get coins for progressing in the game and defeating monsters and goblins and whatnot, but it has an economy and people trade it offline for real money and buy goods ingame with it, BUT chinese farmer/miners will work round the clock to collect up as much of that currency to sell creating ingame hyperinflation.

Sorry that's rubbish, or at least it is an analogy for Bitcoin. The bitcoin algorithm wasn't just scribbled on the back of a fag packet and coded in a lunch time. It has been very carefully designed and occasionally altered by consensus to mimic a natural resource, to make discovery of bitcoins increasingly difficult by halving the reward every four years or so and very cleverly to also maintain that rate of increase by dynamically matching the difficulty of the puzzle to be solved in direct proportion to the work being done.

Working around the clock (the analogy being the new ASIC processors I suppose) just makes the processing work required to get the same number of bitcoins increase proportionally. The people who will benefit are the very early adopters of course but they won't benefit for long. That's why it's become practically impossible for say the central banking cartels or their government stooges to mount a 51% attack and try to take control of bitcoin, they simply cannot generate enough processing power to overcome the algorithm.

As for the coins themselves, there isn't an unlimited supply, the inflation is a defined and known quantity, there will be close to 21 million bitcoins eventually, that's it, done. Every four years the number rewarded to workers for discovering a new block will be halved. It started at 50 per block, it's now 25 and by 2017 it will drop to 12.5.

That's why the monopoly money cartels only realistic option of controlling it is to outlaw it, drive it underground and try to confiscate them from people. Much like the war on some unapproved drugs that can't be controlled easily by the central powers there will also be people who continue to ignore those powers and their idiotic rules and carry on regardless in a free market.