Bitcoin

I suggest you read the long-running and unintentionally hilarious ongoing BITCHCOIN thread.

arktc said:   I was suspicious of Bitcoin well before Mount Gox got hacked. I'm not sure people will have the same confidence in it after that.

Magic the Gathering Online Exchange had 80-90% of the exchange volume back then. It's down to 61% now.

I may be wrong, and I know I'll get red for it anyways, but wasn't Tech Trooper shilling for bit coin in the last thread too?

I'm starting bitcoin v2.0, anyone interested in getting in on the ground floor?

Apple & Bitcoin

hostfat said:   Do you know that usd/euro aren't gold covered by more than 40 years?
Yes, thank you; I think most people here in the Finance forum are well aware of that.

Wired Magazine: The rise and fall of bitcoin

http://www.wired.com/magazine/2011/11/mf_bitcoin/all/1

and more recently: The comeback of..

http://www.wired.com/threatlevel/2011/12/bitcoins-comeback/

spammerorama said:   So inflation is better than deflation? Are you dumb or something?You have to ignore history to think that deflation is better than predictable inflation.

jd2010 said:   kamalktk said:   jd2010 said:   I want 15 second bitcoin cliffnotes....

How I understand it:

Some jerk invented an online currency and then turned it into a pyramid scheme through limiting the quantity in circulation and demand pressures created deflation?
Incorrect in essentially every way, and I'm not a fan of Bitcoin.

Nah, I read a couple articles... this is pretty much what it is.

Perhaps you should read some more.

While I agree that this thread should not have been created (thanks for creating negative attention for Bitcoin OP...), Bitcoins are no more of a pyramid scheme that British Pounds are, or American Dollars, or <insert other currency here>.

Here is a better resource to understand Bitcoins than you may have been reading: https://bitcointalk.org/index.php?topic=7269.0

jd2010 said:   Sounds like the algorithm to create new bitcoins is fixed and becomes more complicated over time to a point where the money supply is fixed. Thus by definition, early adopters to the system have a huge leg up. How is it not a pyramid scheme.

Normal pyramid schemes make it so that ONLY the people who are early adoptors (the people at the top of the pyramid) can make money, and they do so at the *expense of the people underneath them*.

Bitcoin does not enrich anyone at the expense of anybody else. It is a CURRENCY.

Yes, it was easier to get bitcoins in the beginning, but that doesn't make early adopters rich *at the expense of anyone who got in later*.

People who discover Bitcoin later still have the ability to use Bitcoin as a currency, the *exact same way* early adopters can use Bitcoin as currency. Those people who discover Bitcoin later do not have to con others into using Bitcoin in order gain value from it (unlike Pyramid schemes).

That is the main difference; does that answer your question? or not so much?

jd2010 said:   I guess... my only deal is if no one wants to use bitcoin, bitcoins are still worthless, so essentially the early adopters have created value out of nothing and are dependant on others to continue to promote and use the currency, similar to a pipeline in a pyramid scheme.

Guess I'm not thinking about it properly. Thanks for the links.

If no one wants to use {USD, GBP, Euros, insert other currency here}, they are still worthless, so essentially the governments have created value out of nothing and are dependant on others to continue to promote and use the currency...

So you could say all currencies are pyramid schemes by this definition. If you hold funds in USD, it is in your interest to make sure a large amount of people continue to use USD. I think you need to check the definition of a pyramid scheme.

One major difference between bitcoin and other currencies is that there is no central authority controlling the currency. No government can print more bitcoins to devalue current coins, or control the issuance of bitcoins in any way.

cheezedawg said:   nave said:   One major difference between bitcoin and other currencies is that there is no central authority controlling the currency. No government can print more bitcoins to devalue current coins, or control the issuance of bitcoins in any way.I have to have US Dollars to pay my taxes, or else I go to jail. Therefore, USD will always have value to me. I don't need bitcoin for anything.

This is true. But that does not make Bitcoin a pyramid scheme, which is the point that nave and I were addressing.

You posted two naked links. That is why you are getting negative attention. If you had included some talking points and asked for discussion, it would have been better. but you posted pretty much naked links, aggravating members at fatwallet and thus forming negative opinions about btc.

jd2010 said:   Sounds like the algorithm to create new bitcoins is fixed and becomes more complicated over time to a point where the money supply is fixed. Thus by definition, early adopters to the system have a huge leg up. How is it not a pyramid scheme.
Because the difficulty goes up with the rise in computing power. You don't get to calculate based on the initial difficulty with your 2012 pc.

"Early adopters will profit" is not the definition of a pyramid scheme. If it was, any successful company's stock, or land, or oil wells are all pyramid schemes. This is clearly not the case.

Pyramid schemes are not sustainable as they quickly require more people than are living to sustain themselves. Bitcoin does not.

Bitcoin is a great idea because it allows you to send money anywhere in the world in just a few minutes with extremely low fees (around the order of .002%). And you can send to the guy standing next to you just as easily as you can send it to a guy in Shanghai. Why is it that banks don't allow you to do that?

kamalktk said:   TechTrooper said:   ensignlee said:   

While I agree that this thread should not have been created (thanks for creating negative attention for Bitcoin OP...),

This thread is to update and inform the Fatwallet readers about the current status of Bitcoin. The negative attention from some is unavoidable.

First and foremost that attention is created by the incompetence and negligence of exchange operators, such as Magic the Gathering Online Exchange, Bitcoinica, etcetera, and rip-off operators, such as MyBitcoin.com was.

Not mentioning Bitcoin among those who are interested in Finance is not going to improve Bitcoin's image. It will stand or fall on its own merit, no matter what kind of attention it gets. "There is no such thing as bad press" for things that are viable...
Perhaps we should discuss Monopoly money. The current exchange rate is roughly $20 US to $15140 Monopoly.
Monopoly$ has in fact greatly appreciated relative to the US$. When it was first introduced, it was certainly less than $1 US to $15140 Monopoly. So you can see how much better the Monopoly$ has done in relation to the US$. In fact if you look internationally this holds true worldwide. The Monopoly$ has shown remarkable strength in the near 80 years since it's founding.

So to what can we attribute the strength of the Monopoly$. The economy is diversified. Textiles form a sixth of the economy, primarily focusing on handmade goods made with the good old thimble and thread. The textile industry also focuses on the high end, specializing in top hats. Clothing in general is a focus, notably boots and shoes. Farming is another pillar of their economy, though oddly it's still done mostly by a man with his horse, a wheelbarrow, and a Scottie dog by his side. Manufacturing is also strong, being internationally competitive in such varied products as irons and locomotives. There is also a strong auto industry focused on high performance classic designs. Their national bank rakes in bags of money. All this is backed up by a strong military. They are notably strong at sea, having a large number of ships, and have plentiful artillery. Finally, a huge tourism industry means they have hotels just about everywhere. This influx of visitors brings in a large amount of money.

With such a strong and diversified economy, it is no wonder that the Monopoly$ has been strong. It's expected to maintain this strength in the future.

All you ever wanted to know about BitCoin:

http://forums.somethingawful.com/showthread.php?threadid=3486823

Come for the brain damage caused by the overheating servers, stay for the dehyrdrated strawberries. Guest visits from swindlers, scammers and pedophiles.

BitCoin: Fun for everyone! It can only go up, uP, UP!

The problem with bitcoin is that the money supply is slowly declining to zero. This is very undesirable.

Stupidity, commoditized.