This year's best investment up 5250% ...

grey_gym_sock

well, bitcoin doesn't carry the kind of risk that FSCS deposit protection covers. i.e. there is nobody who owes you money and therefore might default.

it does carry other risks instead, though. e.g. your computer could get cracked and your bitcoins stolen. there are precautions you can take against this, though no guarantees.

dryhat

grey_gym_sock wrote: »

suppose that use of anonymous digital currency will expand massively. (even exponentially, for a while.) this seems plausible to me.

but does it have to be bitcoin? it could be another digital currency. (it could be several, with some form of exchange between them.)

There is nothing stopping anyone from bringing out their own version.

There already many competing so-called "Alt-coins" which can be bought and sold just like bitcoins.

However, "Bitcoin" as a protocol is also a new technology and all of these other coins use the same peer-to-peer technology but differ only in things like the number of coins issued etc.

Bitcoin is the oldest, biggest and the best and until something comes along that does things better, it will remain that way.

brendon

Could the recent doubling of value not be somehow related to the closure of Silk Road? First, the FBI seized about $84 million worth of Bitcoins (about 3% of the total currency available). Also, closing Silk Road will cause significant problems with the flow of currency. (Whatever way you look at it, a significant number of Bitcoins are exchanged for drugs.) I'd be extremely careful with the latest increases. Not only does it have the hallmarks of a bubble, it has the driving reasons for one as well.

dryhat

innovate wrote: »

It's an undeniable fact that criminals such as drug dealers and money launderers love bitcoin. Its regulation-free nature is the nirvana of the underworld. Honest bitcoiners will have a tough job to ensure they aren't getting inadvertently caught in the quagmire. For just only that reason, I am out too!

Contrary to popular belief, when it comes to laundering money, cash is much better than Bitcoin because Bitcoin transactions are traceable.

The silk road bust was a great boost for Bitcoin because it busted the myth that illegal activity was all that supported its demand.

The rising price since the bust has proven Bitcoin's resilience and the demand is based on scarcity and utility value. When it comes to ease of use, speed and security, it has no rivals and in one form or another digital crypto-currency is the future of money.

brendon

dryhat wrote: »

the demand is based on scarcity and utility value.

The value hasn't increased because demand has increased. It's increased because supply has decreased -- people are holding onto their Bitcoins because they have nothing to spend them on since Silk Road closed.

dryhat

brendon wrote: »

Could the recent doubling of value not be somehow related to the closure of Silk Road? First, the FBI seized about $84 million worth of Bitcoins (about 3% of the total currency available).

There were 2 lots of "seizures" - one from client accounts held on the site and the owner of the site's personal stash.

The amount "seized" as personal was reported as 600,000 bitcoins. But this figure was the amount of commision from drug sales going back 3 years when bitcoins were priced in pennies, so there is no way he had earned £84m

But the beauty lies in the fact that although they can see the "seized" bitcoins sitting there and can follow all transactions to and from that address, the most powerful nation on earth with all their sophisticated technology are unable to spend/use/transfer a single bitcoin from that address to their own.

That is the power of Bitcoin and why it scares the 5h1t out of the authorities.

dryhat

brendon wrote: »

The value hasn't increased because demand has increased. It's increased because supply has decreased -- people are holding onto their Bitcoins because they have nothing to spend them on since Silk Road closed.

Not true, my friend. There are many, many places to spend bitcoins.

The increase is based on sound fundamentals.

JohnRo

There is nothing wrong with competing currency imo, it is, like all competition a healthy thing, as long as it has integrity, trust and liquidity then there's no reason it can't be readily exchanged for goods and services people need. That will take a long time though, which is the road btc is travelling.

What btc introduces which is new and still largely untested beyond the still very small btc community is a global marketplace and price discovery based on a level playing field rather than one controlled and manipulated by a self serving gang of crooks.

The challenge for governments, beyond just waging a war against or for control of it, which let's face it seems the most likely outcome given their history, is how they can otherwise access and extract the pound of flesh they require to keep themselves in the manner to which they've become accustomed.

dryhat

There is no logical or practical reason why we have to borrow our means of exchange from crooks in order to trade with each other.

Bitcoin solves this problem and puts the power back into the hands of the people. It is an idea whose time has come and there is no going back.

This ingenious and elegant technology is, step-by-step, paving the way to a better world and is here to stay, regardless of what any government thinks.

vectistim

I'm slightly cynical about Silk Road, I had a look and from the type and volumes of stuff being advertised I would be surprised if any professional criminals were using it (either that or TV has de-sensitised me to criminals doing taking the risk for surprisingly small rewards). It wouldn't surprise me it were revealed to have been an FBI creation in the first place.