Bitcoin discussion and news

[free spirit]

Its the age old myth about speculators by those that don't understand how markets work. Speculators can only drive a marketplace for so long. Ultimately, the laws of supply and demand determine price. They are merely speculating on where they believe the market will actually be. And no speculators want to get "stuck" with a supply that has then decreased in value.

What you've described quite well there is pretty much exactly how market bubbles develop then crash down once the speculators have pushed the price up as far as they can, and you're right, the speculators mostly tend not to be the ones that get stuck with the supply once it's decreased in value - they buy at the bottom, sell at the top, and leave all the jonny come lately small folk to buy at the top and sell at the bottom... or not sell, they don't really care.

 

[elbows]

Libertard is a horrible word, Idaho, and I'm surprised it's accepted on here.

I prefer Randroid, myself, although I wouldn't really use either.

I'm not sure it is accepted here, doubt this thread has attracted sufficient attention from enough posters for it to be fully picked up on.

I'm going with liberturdian myself.

 

[Idaho]

Libertard is a horrible word, Idaho, and I'm surprised it's accepted on here.

I prefer Randroid, myself, although I wouldn't really use either.

Yeah it is based on "retard" which isn't acceptable. I've heard lolbertarian too.

 

[Idaho]

Much better, and in stark contrast to the earlier claims about my ignorance, leftist manuals and straw men.

I am done now unless I come up with any different points or new angles. I agree with your comments about technology, although in this specific case I'm struggling to see the potential but I raraely say never so I'll keep half an eye on it. There are important parts of the jigsaw missing in this case but I will be interested to see if other approaches, algorithms etc offer something with greater potential one day. Peer to peer in general has all sorts of potential but sadly its barely been tapped so far.

Bitcoin is a learning process. It may give us ideas about how to do it better. How to create a currency that resists speculation and isn't skewed to create wealth disparity.

 

[King Biscuit Time]

Looks like I sold my dead Granny's soverigns at exactly the right time.

Look at me! I HAS MAD SPECULATING SKILLZ!*


*And I had to get my car MOTed and didn't have any money.

 

[camouflage]

Libertard is a horrible word, Idaho, and I'm surprised it's accepted on here.

I prefer Randroid, myself, although I wouldn't really use either.

I disagree, it's not cool to call people with developmental conditions retarded. There are cases of very specific social developmental conditions that affect people that can technically be described as libertarded. The problem being a degenerate concept of 'liberty' that has quite literally retarded their capacity to relate to human society in general.

Symptoms include market-psychopathy and a love of shinny yellow metal. The likes of Murry Rothbard, Ludwig von Mises and Ayn Rand can often be found among their leavings.

 

[Fez909]

I disagree, it's not cool to call people with developmental conditions retarded. There are cases of very specific social developmental conditions that affect people that can technically be described as libertarded. The problem being a degenerate concept of 'liberty' that has quite literally retarded their capacity to relate to human society in general.

Symptoms include market-psychopathy and a love of shinny yellow metal. The likes of Murry Rothbard, Ludwig von Mises and Ayn Rand can often be found among their leavings.

Not sure if I agree or not, but your point is well made and funny

 

[Idaho]

Looks like I sold my dead Granny's soverigns at exactly the right time.

Look at me! I HAS MAD SPECULATING SKILLZ!*


*And I had to get my car MOTed and didn't have any money.

I see you've been on bitcointalk.org

 

[fredfelt]

I was talking about on this thread, where the onus on those who dont like me pointing out emperor bitcoins lack of clothes is to refute the points properly. Not tell me to start another thread, or attempt to use my modesty about how well I understand bitcoin to make out that I know nothing, or to protest in a manner that lacks proper detail.

It would be one thing if nobody had pretended that these bitcoin games were anything other than a fascination with profiting from fluctuations. But no, they were the ones that brought up all the other alleged theoretical wonders this currency might enable. Should they be allowed to do that without having these details scrutinised?

What is a currency supposed to be for anyway? Its supposed to be a flexible token that enables transactions to take place without having to resort to very crude bartering systems. People might reasonably expect it to be a store of wealth. Almost everything else is secondary or gambling or attempting to profit without adding any real value/doing meaningful work.

Therefore what I would be looking for primarily in a currency would be stability, mechanisms to prevent people gaming the system, etc. The ideal currency would always be available in just the right quantity to match the number of transactions that people want to perform, whilst not fluctuating in value in a manner that creates risks and rewards. But bitcoin appears to be preoccupied with a very different set of criteria, some of which may be desirable but are surely secondary to the most important attributes of a currency. Perhaps there are attributes I have missed or misunderstood which would enable the sensible criteria I've highlighted, but I dont see much in the way of anyone really trying to explain that in replies of the last day or so, quite the opposite.

Play the games if you want to, just dont expect me to keep quiet if you start dressing it up as having some higher pure purpose that will be good for humanity unless you are prepared to discuss what features it had that would actually enable this. Personally I think its already too late for that, with any ability to make out that this currency can support decent political, moral etc principals already undermined by the undisguised drooling glee of marketplace trading wank. As a result of that the scene has already been set for great cynicism regarding those who take a positive position on bitcoin, it just becomes another part of the usual game. And thats not my fault, it was already evident before I pointed it out, and even effective attacks on my words cannot rehide those aspects.

I don't think I have not taken a stance either way on how useful Bitcoin is or expressed an opinion about it's potential wider social context. My first reply to you (884) I was trying to understand more about your ad hominem criticisms of Bitcoin proponents and also express that my interest was more about how the currency developed. Then you posted:

Blessed are the bitcoin yuppies, they will save us.

I don't expect you to keep quiet but I'm still interested in your apparent distain for anyone who has used the system

.. principals already undermined by the undisguised drooling glee of marketplace trading wank

Personally I think the criteria which people assess Bitcoin by are many and varied. Your narrow focus on the few who expose the 'higher pure purpose that will be good for humanity' does not help to draw out the remarkable qualities of this virtual currency.

There are clearly problems with Bitcoin as a store of wealth, however as a method of exchange it's much more interesting.

In the past payment systems (BACS, EFTPOS, Paypal, credit cards etc) have taken years to develop, had huge investment from established institutions, required highly regulated central authorities and the rule of law for them to be credible.

Then Bitcoin comes along, its apparently devised by one guy and by its peer to peer nature it becomes a worldwide payment system. It's still a small and niche payment system but radically different from any other payment system which has proceeded it. Understand why it's different to current payment systems and then we can start to guess at the wider social implications - if indeed there are any.

And yes, I speculated on Bitcoin - almost by chance. Last year I was using the currency to do a bit of 'shopping'. I noticed it's deflation and decided to buy more in advance of my next purchase. Any cash stored in my bank is doing fuck all so why not take a punt?

 

[Idaho]

I've been speculating a bit. Just trying to pay off the mortgage. It's very risky though. You can end up with nothing. Risk and reward is a part of the game. Is it a part of the problem? I don't know. I don't know if there is an alternative to rewarding risk in this way.

 

[camouflage]

I don't think I have not taken a stance either way on how useful Bitcoin is or expressed an opinion about it's potential wider social context. My first reply to you (884) I was trying to understand more about your ad hominem criticisms of Bitcoin proponents and also express that my interest was more about how the currency developed. Then you posted:



I don't expect you to keep quiet but I'm still interested in your apparent distain for anyone who has used the system





Personally I think the criteria which people assess Bitcoin by are many and varied. Your narrow focus on the few who expose the 'higher pure purpose that will be good for humanity' does not help to draw out the remarkable qualities of this virtual currency.

There are clearly problems with Bitcoin as a store of wealth, however as a method of exchange it's much more interesting.

In the past payment systems (BACS, EFTPOS, Paypal, credit cards etc) have taken years to develop, had huge investment from established institutions, required highly regulated central authorities and the rule of law for them to be credible.

Then Bitcoin comes along, its apparently devised by one guy and by its peer to peer nature it becomes a worldwide payment system. It's still a small and niche payment system but radically different from any other payment system which has proceeded it. Understand why it's different to current payment systems and then we can start to guess at the wider social implications - if indeed there are any.

And yes, I speculated on Bitcoin - almost by chance. Last year I was using the currency to do a bit of 'shopping'. I noticed it's deflation and decided to buy more in advance of my next purchase. Any cash stored in my bank is doing fuck all so why not take a punt?

You are evil and greedy and bad, and your horrid funny money proves that you seek only to hoard wealth like a miser and not pay any taxes, and stuff. Your magical beans are too volatile to use in any useful way and there are speculators. By taking an interest in bitcoin you have proved that you are deluded by the promise of technological utopianism. Boo to you.

 

[kabbes]

I've been speculating a bit. Just trying to pay off the mortgage. It's very risky though. You can end up with nothing. Risk and reward is a part of the game. Is it a part of the problem? I don't know. I don't know if there is an alternative to rewarding risk in this way.

"Reward" is a funny word to use, don't you think? It implies a moral dimension. Rewards are deserved in some way.

The acceptance of risk is not in and of itself of worth. It is not de facto something to be rewarded. Sometimes, in fact, there may be a feedback mechanism that means the accepting of risk decreases the stability of the system, which is of negative value.

 

[littlebabyjesus]

I don't pretend to understand the ins and outs of bitcoins, but if people are buying them as an investment, rather than a means of exchange, this is very bad, no? It's simply a fetishised form of money that encourages exploitative mathematical games. No better than futures markets or hedge bets.

 

[littlebabyjesus]

"Reward" is a funny word to use, don't you think? It implies a moral dimension. Rewards are deserved in some way.

The acceptance of risk is not in and of itself of worth. It is not de facto something to be rewarded. Sometimes, in fact, there may be a feedback mechanism that means the accepting of risk decreases the stability of the system, which is of negative value.

And especially with a currency, I would have thought, where stability is kind of the point. If people are buying these things in the hope that their value will go up, what actual value are they adding to the system? What real things in the economy is this activity producing?

 

[camouflage]

And especially with a currency, I would have thought, where stability is kind of the point. If people are buying these things in the hope that their value will go up, what actual value are they adding to the system? What real things in the economy is this activity producing?

Money's not supposed to produce anything.

 

[littlebabyjesus]

what is money?

My point, though, is that people seem to be buying bitcoins in the hope that their value will go up, but what is the mechanism in the real economy that is pushing their value up? Are they just a bubble, a Ponzi scheme? Same criticism of those who trade in money for its own sake applies - what value are you adding to the world to justify what you're doing?

 

[Idaho]

"Reward" is a funny word to use, don't you think? It implies a moral dimension. Rewards are deserved in some way.

The acceptance of risk is not in and of itself of worth. It is not de facto something to be rewarded. Sometimes, in fact, there may be a feedback mechanism that means the accepting of risk decreases the stability of the system, which is of negative value.

Reward just means some financial gain in this context. There isn't any moral dimension. When you invest in something you are betting on its success. Whether it's a horse, a house or a currency. The amount you hope to gain is proportionate to the collective estimate of risk. At least that's the theory.

 

[littlebabyjesus]

Money's not supposed to produce anything.

Yes it is. It is supposed to facilitate an exchange. That's what it's for.

 

[littlebabyjesus]

Reward just means some financial gain in this context. There isn't any moral dimension. When you invest in something you are betting on its success. Whether it's a horse, a house or a currency. The amount you hope to gain is proportionate to the collective estimate of risk. At least that's the theory.

By hoarding it?

 

[fredfelt]

And especially with a currency, I would have thought, where stability is kind of the point. If people are buying these things in the hope that their value will go up, what actual value are they adding to the system? What real things in the economy is this activity producing?

Therein are the disadvantages and advantages of this system. It's potentially both a commodity and a means of exchange. The gold standard as a monetary systems has similar criticisms levelled against it. The stability of currencies is due to the fact that they do not it themselves produce real things - they function is a means of exchange and a store of wealth.

 

[Idaho]

My point, though, is that people seem to be buying bitcoins in the hope that their value will go up, but what is the mechanism in the real economy that is pushing their value up? Are they just a bubble, a Ponzi scheme? Same criticism of those who trade in money for its own sake applies - what value are you adding to the world to justify what you're doing?

Adding value to the world? No more value than when I watch Eastenders or drink beer or scratch my balls. 95% of human activity adds no value. There are possible justifications for speculative investment in emerging markets and technologies, but I won't bother going into them.

The reason to purchase a currency is either to transact immediately, or in the near future in a market that only allows that currency (euros when going on holiday to Spain, btc when buying on silk road). Or you are buying it in the anticipation of wider adoption and potential greater future buying power.

 

[littlebabyjesus]

The reason to purchase a currency is either to transact immediately, or in the near future in a market that only allows that currency (euros when going on holiday to Spain, btc when buying on silk road). Or you are buying it in the anticipation of wider adoption and potential greater future buying power.

As fredfelt says, you're either using it as a means of exchange or treating it as a tradable commodity itself. If you're buying it in anticipation of wider adoption, any extra value you gain is at the expense of those who adopt it after you. You haven't added value to the world.

 

[camouflage]

My point, though, is that people seem to be buying bitcoins in the hope that their value will go up, but what is the mechanism in the real economy that is pushing their value up? Are they just a bubble, a Ponzi scheme? Same criticism of those who trade in money for its own sake applies - what value are you adding to the world to justify what you're doing?

Well, I don't speculate in bitcoin. But buying and speculating on money with money is not a new thing to do with money, people do it all the time. Before floating exchanges they did it with gold. People are criticisng the technology because it enables people to do things with money that they usually do with (shock, horror) money.

In fact most early adopters of this technology are more interested in the technology, or libertardian ideology, or cryptography, or frictionless remmittence or privacy or all sorts of things. The speculation gets the headlines though, and the speculators are thought of as the core bitcoin users.

Me, I first realised how interesting money was decades ago (and I'm only in my thirties), not in terms of bling and things, but as a concept and mechanism, as a form of communication and coordination. Money is basically a rationing system, it's fascinating stuff. That's why I became fascinated with bitcoin.

Speculation is the headlines, you should look beyond headlines into underlying forms. I am however enjoying the debate about the nature of money that the bitcoin headlines have caused. Delicious zeitgeist right now.

 

[camouflage]

Yes it is. It is supposed to facilitate an exchange. That's what it's for.

That's not production though is it, it's an informational role.

 

[Idaho]

As fredfelt says, you're either using it as a means of exchange or treating it as a tradable commodity itself. If you're buying it in anticipation of wider adoption, any extra value you gain is at the expense of those who adopt it after you. You haven't added value to the world.

Oh go on then, I'll bite.

Scenario 1: It takes off and becomes widely adopted.
Scenario 2: It fails and fizzles out.

In scenario 1,early adopters benefit and later users get a new technology that might save them money or give them some utility.

In scenario 2, early adopters lose all their money and there are no later users.

What's the problem?

 

[littlebabyjesus]

Didn't mean to suggest it was new. Quite the opposite, really. This should be in the 'Stock exchange and currency markets' forum, no?

 

[littlebabyjesus]

Oh go on then, I'll bite.

Scenario 1: It takes off and becomes widely adopted.
Scenario 2: It fails and fizzles out.

In scenario 1,early adopters benefit and later users get a new technology that might save them money or give them some utility.

In scenario 2, early adopters lose all their money and there are no later users.

What's the problem?

A potential problem might be the incentive to hoard. Isn't the whole thing rather deflationary at the moment?

 

[Idaho]

Not right now. It went from $260 to $50 in a few days! The hoarding is fading as a hobby.

 

[littlebabyjesus]

Not right now. It went from $260 to $50 in a few days! The hoarding is fading as a hobby.

Fair enough. You make a reasonable point about the role early adopters play in establishing something like this. I'm still not sure where I stand on it, tbh.

 

[Idaho]

I'm not sure where I stand on the contribution my pension scheme has on the world. I am not sure if the price I pay for the commodities I use and the food I eat is helping to extend the inequities in society. We are balls deep in this world and selectively singling out particular features is a luxury.