Bitcoin - Part 2

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Puppycow said:
If too many try to cash out at once, the price would come crashing down again.
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Just like with every currency or commodity in existence.

If everyone tried to get their $$$ out of the bank in the entire country, on the same day, there would be an absolute **** storm of epic proportions.

Sure it can be worse with some than others, but in all actuality why even bring that up?
 
p0lka said:
I dunno, bitcoin has an inherent value as you have demonstrated in your post.
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Having value and its usefulness as a currency are very separate concepts and I'm not sure what "inherent value" is supposed to mean. Things are worth whatever people are willing to exchange for it whether it is gold or toast that looks like Jesus, value is in the eye of the exchanger.
Any currency that increases in value rather than decreases in value over time is a horrible idea, it creates incentive to put currency in your mattress and not put it to use. Having a massive transaction fees of over $20 per transaction makes it only useful for very large transactions. Loaning and borrowing, a basic function in a modern economy, is also out of the question. Starting a mortgage 5 years ago would mean being in debt hundreds of millions of dollars today or do you guys imagine a brave new world where debt and loans don't exist( even black markets for such things)
And the carbon footprint... Complete unsustainable insanity.
 
@portlandatheist you are correct. As a currency, bitcoin is totally useless for the reasons you list. Not only that but because bitcoin came first, any alternative currency that tries to correct the problems with bitcoin as a currency is doomed to fail (since nobody wants a currency that is subject to inflation or demurrage).

But the underlying blockchain technology is revolutionary and set to change the way we do a lot of things and bitcoin is still a useful investment.
 
https://news.bitcoin.com/analysts-debate-power-consumed-per-bitcoin-transaction/
Assuming that the current 7-day average for daily bitcoin transactions of 268,369 is accurate, Marc Bevand’s estimate that the annual consumption of the bitcoin network may be 4.12 TWh/year would mean that each bitcoin transaction requires the same amount of electricity used to power a typical American home for approximately 3.47 days, whereas the estimate of 4.73 TWh/year would mean each transaction requires enough power to run an American household for 3.98 days. As for the higher and lower bound estimates, if the bitcoin network consumes 6.78 TWh/year each transaction could power an American home for 5.7 days, whereas if the network consumes 2.85 TWh/year each transaction could power such for roughly 2.4 days.
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Kinda makes buying a sandwich with bitcoin an absurd proposition, that's where fiat federal reserve notes come in really handy, when you want a sandwich.
 
portlandatheist said:
Um, is this economist article correct in terms of transaction costs or are they instead thinking about mining costs?
https://www.economist.com/news/fina...illiquid-asset-can-be-harder-getting-bitcoins
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Transaction fees aren't as high as the article indicates, and there are a number of things (BCH mining, block size, etc...) affecting them that will in all likelihood cause them to be lower in the future (lightning network, higher blocksize). You can also just wait for a longer confirmation and cheaper rates.

A currency that increases in value has many problems:
It discourages us from trading in goods and services because the price of those goods and services gets better every day, slowing down the economy.
It discourages any sorting of loaning of any kind making things like buying a house impossible. Imaging having a mortgage for $250,000 house in bitcoins 5 years ago. You would owe millions and millions of dollars today.
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Total nonsense. Do you buy less groceries when they go on sale? Do consumers wait on buying consumer electronics, which despite incredible monetary debasement, still get cheaper over time? As for a bitcoin mortgage, don't borrow assets which will appreciate more than the asset you are exchanging it for! You would be a fool to borrow bitcoin to pay someone in bitcoin for a house.

No central body like the Federal Reserve can control its supply which is a bad thing in my opinion. There is a reason the US dollar is the most successful currency in the world.
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You sound like a central bank spokesperson. The Federal Reserve isn't "controlling its supply", it's creating trillions in fiat money and handing it out to its friends.

The reason the US dollar is "the most successful currency in the world" is because of the petrodollar standard whereby the full might of the US military is brought to bear on anyone who dares sell oil in anything other than US dollars, leaving the Federal Reserve to counterfeit unfathomable sums of money at the rest of the world's expense.

Bitcoin=tulips. Sooner or later the music is going to stop and a lot of people aren't going to have a chair to sit down in.
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Maybe, maybe not. Bitcoin has real utility today, by enabling people to move money across borders and away from tyrannical and confiscatory governments and politicians. That has value today whether or not it becomes a "currency" tomorrow.
 
lmao@ all of the deflection in this thread from the people who ended up being completely wrong about bitcoin.
 
psionl0 said:
@portlandatheist you are correct. As a currency, bitcoin is totally useless for the reasons you list. Not only that but because bitcoin came first, any alternative currency that tries to correct the problems with bitcoin as a currency is doomed to fail (since nobody wants a currency that is subject to inflation or demurrage).
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Except, it's not necessarily doomed to fail. Do you see it continuing to appreciate at this rate in perpetuity? I don't. At the point at which the price stabilizes and the transaction costs are lowered, it may begin to resemble a currency, rather than the speculative digital asset that it is now. If it will be a global currency, then that price will surely be a huge multiple of what it is even now, and the satoshi will be the unit of account for transactions.

Apparently a lot of people want currencies that are subject to inflation and demurrage, yourself included!
 
portlandatheist said:
https://news.bitcoin.com/analysts-debate-power-consumed-per-bitcoin-transaction/

Kinda makes buying a sandwich with bitcoin an absurd proposition, that's where fiat federal reserve notes come in really handy, when you want a sandwich.
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This is where networks like ripple come in handy. Banks themselves are using the ripple network so this is an example where the blockchain is changing things.

If you deposit 1BTC with your "trusted gateway" then you can send payments across the world (even changing currencies along the way) to anybody on the ripple network. As long as you don't need to withdraw anything from your gateway, you can send and receive payments on the network without experiencing the limitations involved with a bitcoin wallet to wallet transaction. Hence, there could be far more bitcoin transactions than would be indicated by bitcoin's blockchain. Ripple is like a fully automated banking network.

Of course, if your "trusted gateway" absconds with your loot then you may not be able to do anything about it. (Note that the ripple itself complies with KYC laws so you may have legal redress but anybody can use the network so there is nothing to stop you risking your money on a fly-by-nighter if you want anonymity).
 
psionl0 said:
I think you may have read my post incorrectly. I didn't say that bitcoin was doomed to fail I said that any currency that was not like bitcoin was doomed to fail.
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Yes, I misread, but the intent of your post was that it is totally useless as a currency, with the implication that it will remain so in perpetuity. I don't think this is necessarily the case. It could reach a point where the rate of deflation becomes acceptable for commerce, yet it will still be deflationary.
 
Tippit said:
Yes, I misread, but the intent of your post was that it is totally useless as a currency, with the implication that it will remain so in perpetuity. I don't think this is necessarily the case. It could reach a point where the rate of deflation becomes acceptable for commerce, yet it will still be deflationary.
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As I said above (http://www.internationalskeptics.com/forums/showpost.php?p=12097002&postcount=919), increasing transaction fees are likely to stop bitcoin gaining acceptance as a currency. The limited number of transaction that can be recorded in any block will ensure that only transactions that offer the highest fees will be confirmed so bitcoin will only be useful for large denomination transactions. (So much for Mhaze's pizza buying days).
 
Who has bought and sold bitcoins?

How do you know you are not dealing with some intermediary keeping their own ledger?

How difficult to buy $100 in bitcoin and then buy some pizza?

Broker says: "The spread, usually indicated in pips, is the difference between the price that you have to pay to buy an assets and the price that you would get by selling it." Hmmm.
 
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psionl0 said:
With a credit card you are borrowing money. That is never better than using your own.


You forget that to get a miner to confirm your transaction you need to offer them a transaction fee (the smaller the fee, the few miners that are willing to confirm your transaction). As the reward per block decreases and the cost of mining increases, you will need to offer ever larger transaction fees to attract a miner.


GOTO 910.
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No
 
psionl0 said:
:confused:
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For someone enthusiastic about Bitcoin I am surprised by your post.

Nodes are needed but do not get "paid".

https://www.coindesk.com/bitcoin-nodes-need/

It's well known that bitcoin is designed as a decentralized peer-to-peer (P2P) network. However, what's often lost in translation is the sheer amount of machinery that is needed to maintain this global infrastructure.

For example, in order to validate and relay transactions, bitcoin requires more than a network of miners processing transactions, it must broadcast messages across a network using 'nodes'. This is the first step in the transaction process that results in a block confirmation.

To function to its full potential, the bitcoin network must not only provide an avenue for transactions, but also remain secure. By using a number of randomly selected nodes, the network can reduce the problem of double spending – when a user attempts to spend the same digital token twice.

However, bitcoin doesn't just need nodes, it requires lots of fully functioning nodes – nodes that have the bitcoin core client on a machine instance with the complete block chain. The more nodes there are, the more secure the network is.

This is one of the reasons there is a plan to put bitcoin nodes in space, and that the plan has important implications for bitcoin.

The problem is, the number of nodes on the network is dropping, and core developers believe it may continue to do so.
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And just a few days after $10,000 it is now at $11,500.

Amazing.

Imagine, just a few years ago you could have bought just 1 bitcoin at $100 and now cash out at $11,500.
 
This is The End said:
And just a few days after $10,000 it is now at $11,500.

Amazing.

Imagine, just a few years ago you could have bought just 1 bitcoin at $100 and now cash out at $11,500.
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I, for one, will definitely admit to kicking myself now.
 
This is The End said:
lmao@ all of the deflection in this thread from the people who ended up being completely wrong about bitcoin.
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Is there an end date for Bitcoin that we passed at some point?

At the moment it seems that Bitcoin might have some value as an investment but it's an investment in its own closed bubble.
 
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