Bitcoin thread anyone?

[LeeD]

Quote from Random.Capital:

Except this is supposed to be a "currency". In which case ownership is 100% not secret - taxing authorities will know who paid your salary, and how, for example - which means your entire transaction history is available to *everyone*.

Not to mention any BTC you spend that don't derive from your reported income are immediately visible to authorities. So now you have a specific "dollar bill" that can be "turned off" - which means it won't be like every other BTC in circulation because of it's provenance - which means every single BTC will have a different real-worked path-dependent value.

This will never work, unless people are willing to give up privacy of financial transactions *completely*.

Here there are 2 issues:
1) Legally bitcoins is NOT currency. So, any payment in them is "benefit in kind" and till a case reaches at least a state court there is no leagal way to determine their worth... or if they are worth anything at all. In fact, my view is any lawyer will have very hard time convincing the jury made up of ordinary people that thanks to meracles of criptography small files containing barely readbale data on your hard drive are unique enough to have any value at all.
2) Bitcoin transactions are anonymous by design. To make it worse, most services working with bitcoins would not give you access unless you do it via a quality anonimiser. Without going too much into detail, the only way authorities can see if you paid or have been paid is by examining log of your transactions stored locally on your computer.... and if they want to see who you paid to they have to examine thr local log of the payee before they can link the 2 people.

So, the only ways, say, tax authorities can start seeing Bitcoin transactions is:
Planting keylogger type software on the computer of most bitcoin users

Otheriwsie there is a long legal process to outlaw made-up currency (try to see the difference to Linden Dollars in Second Life and in-game currency in thousands of online games), anonymising network and force ISPs record any traffic, which is currently not technologically feasible.

Quote from LeeD:

The transaction is "committed" when a sufficient number of Bitcoin nodes acnowledged they recieved info about the transaction.

Quote from Random.Capital:

No possible problems there.

Clearly there are problems. People may try to pay with bitcoins that they have already used to pay to someone else. The idea is if you run a well-connected node you will know it... otherwise, you have to deal with better-connected nodes when you do transactions.

 

[traitor786]

Why is this thread on this site, I was a bit surprised to see something about bitcin here.
It doesn't sound like we are talking about investing in bitcoins here ?

What is the connection between trading and bitcoin I'm missing ?

What do you use bitcion for ?

 

[Algo_Design_Kid]

I am - and I would suggest dollar cost averaging into BTC. Take a look at the logarithmic chart. Most have already discussed the pro's and con's.

 

[Random.Capital]

Quote from LeeD:

Legally bitcoins is NOT currency.

They aren't a currency in any meaningful sense of the word. More importantly, any advantage they may have disappears the moment they do become a currency, as named accounts will be *required*. The fact that a bit coin is anonymous is meaningless when the accounts it moves in and out of are not.

Hence the baseball card analogy - bit coins have zero inherent value. Ironically, just like any other fiat currency.

 

[LeeD]

Quote from traitor786:

Why is this thread on this site, I was a bit surprised to see something about bitcin here.
It doesn't sound like we are talking about investing in bitcoins here ?

Bitcoins are like a currency. So, any talk here is relevent to investing. Yes, it's very new; so, instead of the investment opportunity peopel are discussing pros and cons.

Quote from Random.Capital:

They aren't a currency in any meaningful sense of the word. More importantly, any advantage they may have disappears the moment they do become a currency, as named accounts will be *required*. The fact that a bit coin is anonymous is meaningless when the accounts it moves in and out of are not.

I understand the anonymity of ownership of Bitcoins is deeply inside the design. So, the only way named accounts can be enforced is making bitcoins illegal the way they are now.

There is a good precedent in US history where all gold has been effectively conficated to make sure the gold standard is abandoned in an orderly manner.

If you have to request a bank to commit a bitcoin transaction on your behalf, there is no point in using bitcoins.

 

[Random.Capital]

Quote from LeeD:

If you have to request a bank to commit a bitcoin transaction on your behalf, there is no point in using bitcoins.

Yep. Which is why they are essentially the same as baseball cards. And there's nothing wrong with Inherently investing in baseball cards, either.

But there are folks out there who actually believe this is the currency of the future - they're going to be in for a rude surprise.

 

[Millionaire]

so the recent bubble has already poped, lol

The price has crashed from $30 back to $12??

 

[stock777]

doesnt take much to whip fools into a frenzy over nothing does it.

so if you take two idiots and they swap an apple pit back and forth at every increasing values, is that a market? or is it two idiots?

 

[baggerlord]

I personally am profiting from it, by selling a product I already manufacture in bitcoins at an inflated price and then converting immediately back to dollars. Lots of dumb money changing hands here.

 

[Illum]

I really like the idea. But bitcoin seems difficult. Very illiquid and the fluctuations are too wild for a currency. You need stability in a currency. It's acting like a penny stock. Way too dangerous. But the idea of a currency that would not be printed to death and is out of govt hands is fantastic. Especially since govts all around the world are actively seeking complete power over their people. I hope this continues.