The US dollar isn’t “real” either. The green paper rectangles are used as a means of exchange. Their only value is in the fact that we all agree it has value, and one can reliably exchange it for something of that approximate value. We could just as easily use blue seashells, plastic noodles, or electronic records.
Is the paper issued by the Federal Reserve then REAL MONEY.... A good paradox. It´s where people want to put their trust. People give it value.
We need an article from Larry Kudlow to tell us this?
I guess two out of three ain't bad... IMO though, the regulator is broke!
It’s as real as any electronic bank account balance on anyone’s phone or computer. The powers that be are just mad at Bitcoin’s decentralized architecture.
At any given time, approximately 3% of money issued by the Fed is in the form of paper currency. The rest floats around in the form of digital bits. The source of this statistic is G. Edward Griffin, author of The Creature from Jekyll Island, and also known for interviewing Soviet defector Yuri Bezmenov.
Gee, ya don’t say?
If Kudlow investigated a little further he'd learn that bitcoin's volatility has actually been on the decline as adoption spreads.
It has no central-bank regulation,
One would think Mr. Kudlow could understand that this means there is no central bank that can manipulate the total supply of bitcoins. That is by design.
network operations,
The entire currency is a decentralized network of transaction verification nodes. Why doesn't he at least investigate the basics of the system he is attempting to criticize?
or even centralized issuance.
Issuance is decentralized to encourage the creation and maintenance of the verification nodes that are the bitcoin network. Issuance is regulated and ultimately fixed by the protocol itself. The protocol itself is the 'central bank authority' he wants. This is further proof no one has explained to him how bitcoin works, and he hasn't found out himself. He just has an inkling of who doesn't control it - does he speak on their behalf?
And because of its wild price fluctuations, bitcoin can never be a reliable payment system.
"Bitcoin is still about ten times more volatile than, say, the Euro priced in US dollars. But if Bitcoin’s volatility kept falling in half every three and a half years, it would be as stable as the Euro in less than 15 years." link
The virtual currency originally offered a way to make transactions across borders without third parties like banks. But the collapse of Mt. Gox -- with 850,000 bitcoins unaccounted for, summing to $425 million of losses, according to many reports -- illustrates the grand failure of this digital experiment.
Mr. Kudlow's initial observation has nothing to do with the failure of MtGox. Bitcoin is a way to make transactions across borders without third parties. But MtGox is not bitcoin. MtGox was an exchange that you could register an account with. If you registered an account with MF Global and Jon Corzine took you money out of your account and gambled it on Euro bonds - is that proof that dollars are a failure? Or is it proof that MF Global was mismanaged?
People are pouncing on the MtGox story and using it to spread FUD about something they obviously haven't taken 30 minutes to investigate. If you want to see a brief video explaining what bitcoin is, how the network functions, and how it manages transfers this youtube is a good intro.
Open Source software works because people ultimately use or don't use the software. It either works or it doesn't. It is found to have flaws or viruses in it, or not. Over time good Open Source software succeeds and bad Open Source software fails.
Bitcoin is like an Open Source currency. There is no Central Bank or nation regulating it. But Bitcoin, like all currencies today, doesn't have any intrinsic value. The only thing Bitcoin has that distinguishes it from other currencies is some algorithm defining how much new Bit coinage can be brought into existence. Let's say a bunch of different groups created computer currencies and competed to create the "best" to attract people to use their currency over other people's currencies. What would they do to make theirs better?
The only thing that would make me prefer one currency over another is if a specific group of people stood up and said we guarantee the value of this currency. We will protect this currency. Why would I give my trust to a currency created by someone with an alias and that's being held up by a group of rather shady organizations with little transparency?
However pathetic the US is today, we do have millions of people going to work every day and creating wealth, paying taxes, etc. This suggests that over time the dollar will still have some value. However non-transparent the workings of the Fed are, they do have to report to Congress on a regular basis, they publish their findings, they make public pronouncements, etc.
How far did the Open Source Occupy movement go? Not far because no one wanted there to be any leaders.
How successful has the Tea Party been? A bit more successful, but only because there are some Tea Party members who have stood up and become leaders such as Cruz.
If the Tea Party had gotten no one into elective office and was just a bunch of people gathering regularly to wave signs at politicians then what little it has achieved wouldn't have gotten accomplished either.
With all do respect, years of continuous Freeping in front of the White House didn't get Clinton out of office any earlier and certainly didn't taint his brand in the eyes of the world.
Sometimes you have to fight fire with fire. Currency backed by real people with currency backed by real people. Politicians with politicians.
Bitcoin is tulip bulbs. Bitcoin is a scam. The scammers made their money. There are suckers out there that don't want to be the last suckers. They are trying desperately to unload bitcoins to the last suckers.
“I have been tweeting and broadcasting that bitcoin is not real money”
More than a thousand retail locations would disagree...
It is an exchange of value that is outside government control (largely).
While it's true that a currency like the U.S. dollar has lost its value considerably over time, it's also true that there is some level of predictability in this over long periods, and that short-term fluctuations actually work to the detriment or the benefit of an American citizen (think of someone paying off a 30-year fixed rate mortgage at 5% if inflation is at 8%).
For anyone who really thinks Bitcoins are a legitimate currency, I'd ask a simple question: Would you ever take a job with an employer who paid you in Bitcoins?
That's why people are so desperate to find something else.
Someone should point this out with the trading schemes Al Gore has lined up for his “carbon tax credit$”.
By his own words, neither does the dollar.
Mediums of exchange can be used to represent real money as a convenience. Who wants to carry around bales of cotton all the time? One of the most innovative and secure methods of exchange was the Tally Stick. It was used for 700 years in England.
Bitcoins, which are limited and requires work to make, are more real than the Federal Reserve Notes that are conjured up out of thin air by the private, foreign owned, for profit corporation known as the Federal Reserve, which is neither Federal, nor has reserves. FRNs aren't even real mediums of exchange because they don't represent real money. FRNs represent debt. FRNs are anti-money and destroy wealth.
He forgot "unit of account," which is also a requirement for money. Still, his citation of "central bank regulation" was a red flag for me as to where Mr. Kudlow stands.
Things have never been better for Bitcoin. It’s about to get very, very real.
