What is with the bitcoin obsession?

[helmuth_hubener]

No. That's the situation forever. The more adoption we have the less reason to have exchanges at all. It only gets better from here.

Well, I suppose that is the unreasonably optimistic scenario. The reasons for believing it will evince are... not strong.

Steven's method of usage is impossible without reputable, dependably rapid exchange services. Also, and far more importantly, HYIP people are always going to be interested in exchanging, in cashing out. HYIP are the only people actually using Bitcoin. They are driving the whole thing. All the other users are really small and inconsequential. If all of a sudden Bobby Bob Jr. can no longer obtain U.S. dollars from his pyramid, believe me his interest in Bitcoin is going to evaporate real quick. He has no philosophical interest in agorism to motivate him to weather the storm.

 

[LibertyRevolution]

Escrow services or reputation systems.

This is not rocket science. Just because the current status quo has spoiled everybody with chargeback doesn't mean there aren't alternative solutions, much friendlier to merchant costs, and also much fairer with dispute resolution services.

Spoiled by chargeback.. Yes I expect to be able to easily cancel the transaction at my discretion.
Same reason I don't use cash for large purchases, I don't want to wait for a check in the mail for a refund.

You are saying that to spend bitcoin you have to trust the person your buying from, this is absurd concept to me.
Rule #1 to buying stuff: Never trust the person that is trying to sell you something.

 

[Isar]

What obsession? ask 100 people on the street about bitoin and at least 95 will have NO idea what you are taking about.

However..gold and silver have no inherent value either. IT is not like the old days when it was a great metal to make things with. IT is worth only what people are willig to pay for it.

 

[Indy Vidual]

...HYIP are the only people actually using Bitcoin. They are driving the whole thing...

Do you have some links/evidence to back up that statement?
If 'No', maybe you should stop saying it, month after month, forever...

...interest in Bitcoin is going to evaporate real quick....

Too late, it already crashed and Bitcoin is quietly making progress without so much excess speculation. Your "propaganda" is old now helmuth.

...All the other users are really small and inconsequential....

There is the best part:
Thousands of "small and inconsequential" users are enough to keep Bitcoin prices above $4/BTC, even while many new BTC are still being created every day.

 

[helmuth_hubener]

My evidence is that it is just obvious. You can do your own research and see if you agree with me. You won't. That's cool.

Time will prove me right. By the time it has, you will forget I ever predicted it and will be mainly focused on the sad fact that you lost some money. That's OK too.

 

[psi2941]

Y? isn't this thread dead yet! bitcoin is only worth 5 dollars now. i remember when it was worth like 30-40 dollars and a bunch of clowns on this forums promoting it

 

[hazek]

Three rather big articles just came out:

http://www.reuters.com/article/2012/04/02/us-traders-bitcoin-idUSBRE83108120120402

Bitcoin, the financial traders' anarchic new toy
By Naomi O'Leary
LONDON | Mon Apr 2, 2012 5:52am EDT
(Reuters) - Financial traders have a new toy: Bitcoin, a digital currency variously dismissed as a Ponzi scheme or lauded as the greatest invention since the Internet.

http://www.betabeat.com/2012/04/02/...-we-have-right-now-pro-financial-trader-says/

Bitcoin ‘Is a Better Form of Money Than We Have Right Now,’ Pro Trader Says
Financial traders try to avoid getting Zhou Tonged.
By Adrianne Jeffries 8:12am
Betabeat noticed back in August that professional Wall Street traders were taking an interest in Bitcoin. Even though the Bitcoin market is valued lower than in the past, and volatility (read: easy opportunities to flip coins and make fast money) has also flattened out, it seems pro bankers are still trading in BTC.

http://www.forbes.com/sites/jonmatonis/2012/04/02/watch-bitcoin-robbery-in-slow-motion/

Jon Matonis, Contributor
I cover economics, cryptography, and digital currency.
TECH | 4/02/2012 @ 7:56AM |2,965 views
Watch Bitcoin Robbery in Slow Motion
Bank robberies of the future may not reveal the traditional security camera shot of the ski-masked gun holder but rather we will watch them evolve slowly in front of our eyes as the money hops around the globe. It’s not so much where is the money but when is the money? The public and transparent nature of the bitcoin transaction ledger ensures that all transactions are known by date, time, amount, and block number although not necessarily by the who or the where. Contrary to conventional opinion, this is not a negative for the protocol because bitcoin liberates cash by putting it online.

 

[hazek]

Oh and I forgot this one:

http://uk.reuters.com/article/2012/04/01/uk-factbox-bitcoin-idUKBRE8300JP20120401

Factbox - What is Bitcoin - currency or con?

By Naomi O'Leary
LONDON | Mon Apr 2, 2012 12:16am BST
(Reuters) - Bitcoin is a mathematical money system driven by code. It allows users to send money directly from their computer to another on the other side of the world.

 

[helmuth_hubener]

Consider that attention is not always a good thing.

 

[DEGuy]

After hearing about Bitcoin from this forum a few weeks ago (thanks Hazek!), I went and explored it, bought and sold some coins, looked at investment opportunities, etc. My verdict: I'm pretty impressed. I think this system of currency has some potential, especially since it does not have a central source regulating it. Even PM's are subject to the intervention of governments that have stored vast amounts of gold and influence the international trading platforms. Due to the nature of the internet and how the bitcoin is maintained, governmental manipulation would be difficult, although not impossible.

Here are my conclusions:
1. Due to the nature of bitcoins, it is extremely easy to use them to assist in illegal activities (drugs, money laundering, etc). And there are some people making a small fortune off this fact, and it will continue to grow. On the plus side, it provides a consitent demand for the currency that is not tied to speculation.
2. Eventually governments will intervene because they think they can stop people from doing illegal business by cutting off one method of operation. It'll be interesting to see what they do (attempt to buy out the bitcoins, interrupt the network, criminilize exchanges)
3. I would accept payment from someone anonymously in Bitcoins in exchange for selling something. I used to sell comic books online, but stopped because paypal could essentially shut me down when one buyer had a disagreement. I'd even offer a 10-20% discount for using bitcoins.
4. There is an appropriate risk/reward ratio to investing in Bitcoins. It's a moderately high risk, but given the projected demand for the currency, and the projected deflation in purchasing power of the dollar, I think there is also a high level of reward. It's not for the faint of heart, but a few percent in a portfolio is pretty reasonable. It's probably a lot less risky (and transparant) than a lot of the crazier derivative investments that are out there.

 

[hazek]

You're welcome.

Btw have people read this pretty awesome article/introduction from a libertarian perspective?:

http://evoorhees.blogspot.com/2012/04/bitcoin-libertarian-introduction.html

Bitcoin - The Libertarian Introduction

What it is, how it's used, and why you should care.

Erik Voorhees - April 11, 2012

"When a state currency is challenged, the state itself is challenged,
and market forces move swiftly around sickly, depreciating inhibitors."

· Introduction
· What is Bitcoin?
· How does it work?
· Why is Bitcoin valuable?
· No really, WHY is Bitcoin valuable?
· How does one obtain it?
· Being careful with money
· What can one do with it?
· Bitcoin vs. The State
· Bitcoin and Disruption
· Useful Resources

Introduction

There has been much talk about Bitcoin within libertarian and economic circles. It's becoming a buzzword, but like all new systems that break onto the public stage quickly, Bitcoin brings with it excitement, speculation, rumor, and downright confusion. To be sure, Bitcoin is complicated. After all, it's an entirely new global monetary system - both a currency and a payment network for that currency.

Like all powerful tools, it's important for those interested in using Bitcoin to spend some time engaging in the due diligence of education. Similar to a bicycle, once you know how to use Bitcoin, it will feel very easy and comfortable. But also like a bicycle, one could spend years learning the physics that enable it to operate. Such deep knowledge is not necessary to the actual rider, and in the same way one can enjoy the world of Bitcoin with little more than a healthy curiosity and a bit of practice.

This article is a primer on Bitcoin: an overview of the fascinating new phenomenon from the perspective of a humble libertarian who cares more about the ramifications for human liberty than about the technical protocol and brilliant science underlying the network.

The basics of Bitcoin are all covered here, ranging from a light technical overview to due diligence to monetary economics and theory. You'll also find an extensive list of resources to bring you up to speed on this most fascinating thing to happen in the realm of anarcho-capitalist technology since the internet itself.

 

[helmuth_hubener]

2. Eventually governments will intervene because they think they can stop people from doing illegal business by cutting off one method of operation. It'll be interesting to see what they do (attempt to buy out the bitcoins, interrupt the network, criminilize exchanges)

It's obvious to me they'll just end the exchangers. Just end them. Rubble. The exchange process is the weak link in the system.

Even if you disagree with my idea that most of the activity happening on bitcoin is HYIPs and other similar vapor, rather than real commerce, -- and that's fine, it's not like anyone has any real statistics on it to prove anything either way -- even if you disagree with that, you should still be able to agree that exchanges are the weak link. They have to be tied into the banking system to function.

It's not for the faint of heart, but a few percent in a portfolio is pretty reasonable. It's probably a lot less risky (and more transparent) than a lot of the crazier derivative investments that are out there.

Using "bitcoin" and "portfolio" in the same sentence is the wrong, wrong idea; a bad idea. But as you say, maybe you like risk, and people make bad investments all the time. Just do not cry when there are no exchangers to convert your bitcoins into dollars.

 

[Indy Vidual]

...to convert your bitcoins into dollars.

Some people don't want to convert BTC to worthless paper money.

 

[DEGuy]

It's obvious to me they'll just end the exchangers. Just end them. Rubble. The exchange process is the weak link in the system.

Even if you disagree with my idea that most of the activity happening on bitcoin is HYIPs and other similar vapor, rather than real commerce, -- and that's fine, it's not like anyone has any real statistics on it to prove anything either way -- even if you disagree with that, you should still be able to agree that exchanges are the weak link. They have to be tied into the banking system to function.

Using "bitcoin" and "portfolio" in the same sentence is the wrong, wrong idea; a bad idea. But as you say, maybe you like risk, and people make bad investments all the time. Just do not cry when there are no exchangers to convert your bitcoins into dollars.

I mostly agree with you on the first point. Governments have already taken swipes at some of the exchanges, and it's possible they could shut them down completely and leave the bitcoin market in shambles or nonexistant.

However, governments can also do the same thing with practically any currency that's being traded. I think we shut trading rials out of world markets as part of the embargo. But that doesn't mean that rials couldn't be a part of someone's portfolio. A risky move sure, but still a legitimate investment. My point was that the risk/reward ratio is pretty reasonable, which is my opinion. And like I said, a few percent (1 or 2) max as an investment under the "I don't mind losing this money, but there is an outside chance it'll pay off well" category. Along the same lines as lottery tickets.

 

[helmuth_hubener]

However, governments can also do the same thing with practically any currency that's being traded. I think we shut trading rials out of world markets as part of the embargo. But that doesn't mean that rials couldn't be a part of someone's portfolio. A risky move sure, but still a legitimate investment. My point was that the risk/reward ratio is pretty reasonable, which is my opinion. And like I said, a few percent (1 or 2) max as an investment under the "I don't mind losing this money, but there is an outside chance it'll pay off well" category. Along the same lines as lottery tickets.

True.

Under the influence of Harry Browne, I split things into speculations and investments. Bitcoin I would consider a speculation.

 

[hazek]

True.

Under the influence of Harry Browne, I split things into speculations and investments. Bitcoin I would consider a speculation.

Buying bitcoins just on expectations of a higher market price is definitely speculation. Using bitcoins as a currency in a global payment system in as many transactions as you can in your daily life is not.

 

[Kluge]

Thought you guys may appreciate knowing there's a more centralized gold-backed (yes, real gold in vaults) "e-debt" in the works. Similarities to a currency, and could be used as currency in the same way a collateralized bond could. This "e-debt" can be redeemed for physical gold, Bitcoins, or kept as redeemable-for-gold e-debt. Yes, it will of course include an currency exchange - one which coincidentally already has a decent track-record.

In addition, the business launching this will be concurrently launching a pawn shop using a "passed-through" pawn license valid in 50 states, and even a credit union chartered with an aim at tech startups. Assuming multiple offices, this means you can "wire" someone in a different city USD/gold/e-debt (they get to choose what to redeem these debt instruments as -- it could also be redeemed for items in the pawn store) by pawning/selling your items. More importantly, this gives the company MSB licensing exclusion in all 50 states, so it's immune against the legal piledriving e-gold suffered. All of this will be housed in a franchise-able tech-friendly and community-oriented hostel where "dorms" are upstairs and bring in the steady income, while ground-level space is used for the various physical/online commercial ventures.

If you have $10k+ (seeking at least $350k total within a few months) and some interest, there's definitely a big initial capital requirement which needs to be addressed as most everything (less the rental units) needs to be launched simultaneously. Things are being done carefully but daringly -- things are moving fast, but there are two competent lawyers working for/with the company, including a lawyer working for a nation's leading payment processor. Certainly more details available if you'd like. If you're in/around San Francisco (will be in Mission District), you could visit the building and operators. There's expected to be some form of an "Investors' Open House" within a couple months, possibly early next month.


Cheers,
Ben (first time *I* have posted in quite a few months)

 

[helmuth_hubener]

Thanks, Ben. That's very exciting. Would the investment be for equity, or are they selling bonds/debentures?

 

[hazek]

Hmm it seems like bitcoins are headed for another bubble valuation, we had significant exchange rate jump in the past 24h, from $7.6 to almost $9 per 1BTC, which is pretty crazy compared to the last 6 months of relative stability. I wonder where this is going from here on out?

You can follow the price movements here:
http://bitcoincharts.com/markets/

Live trading:
http://btccharts.com/#m=mtgox-BTC-USD

EDIT: nvm, it was just someone manipulating the market and making a killing doing it

 

[DEGuy]

Hmm it seems like bitcoins are headed for another bubble valuation, we had significant exchange rate jump in the past 24h, from $7.6 to almost $9 per 1BTC, which is pretty crazy compared to the last 6 months of relative stability. I wonder where this is going from here on out?

You can follow the price movements here:
http://bitcoincharts.com/markets/

Live trading:
http://btccharts.com/#m=mtgox-BTC-USD

EDIT: nvm, it was just someone manipulating the market and making a killing doing it

Yeah, I wish I'd been watching at that time and sold some BTC at the peak. Of course, it's still up pretty high, gonna unload a little bit and take some profit.