Posted on 12/12/2017 7:49:30 AM PST by C19fan
Watch “Banking on Bitcoin” currently playing on Netflix...saw it last night.
Distrust of the governments have to do with their central bank policies that impact the value of a nation’s currency. Ever hear of inflation, or HYPERINFLATION and what that does to the value a nation’s currency.
The idea of digital currency has been discussed since the 70’s, but Bitcoin launched in the aftermath of the government created financial meltdown in ‘08.
The main thing to think about Bitcoin is that it is a accounting system. I would like it to when you go to an arcade and you have to use tokens to play the arcade games. Well you first have to buy the tokens or bitcoins. Bitcoin participants are anonymous, their identities are encrypted. There is no central database where the transactions are cleared, as there are multiple centers located around the world. Transactions have to undergo a test for security purposes.
They say Bitcoin will max out at 21,000,000 Bitcoins. But there is nothing from stopping them from dividing a bitcoin up into tenths for example in order to increase the number of units in circulation.
The whole idea of Bitcoin is to evade the entanglements of currency exchange. However, Bitcoin will not achieve mass appeal unless it can be used to interact with normal everyday financial transactions like paying for gas, food, etc.
No warm-n-fuzzies if you've been doing it and it's still voodoo.
Now, there must be thousands or more folks (well, their PCs are doing the mining) mining bitcoin at any one time. Is this totally distributed? If so, whats to prevent someone "spending" tons of resources in time, money, CPU cycles, etc, perhaps only an hour away from finding a new unit of bitcoin from being superseded by someone else doing the same, only a bit quicker to the draw?
If all bitcoin mining at anytime is centralized, sounds like a lot of network traffic occurs while doing so.
One of the strengths of bitcoin is supposed to be in Blockchain, except that can be used to transfer money as well.
Wish I’d listened to Mike Cernovich and Richard Nikoley last year.
>Beware some web sites use your browser to mine Bitcoins ,even when you close the browser . It’s the only way to make money with Bitcoins , LOL
Fake news.
Actually, bitcoin is not the largest bubble in history and probably not in the top 3-5...
Bitcoins are transferred between digital wallets via the bitcoin network.
That is absolute bullshit.
In order to mine bitcoin you need special processors. These processors are not found on your “home” PC. You could link 100 home PCs together and you would be lucky if you could manager to find 1/1000th of a bitcoin in a year.
Please don’t spread more crap that we need to, OK?
It is backed by just the confidence in the government. That alone. Hopefully, it will hold.
Read the book “Extraordinary Popular Delusions and the Madness of Crowds.”
It has examples of bubbles in the past. But keep in mind, while they are wonderful tales, some of the reporting is wildly off from the real thing.
The section on the tulip bubble is a decent work of fiction that represents the “feeling of the truth” but is not accurate.
If a person is mining alone, then finding new coins is random. There’s no way to know exactly which miner will find the next coin. Most miners work in mining pools, which gives them better odds of finding the next coin, and the pool then splits the rewards according to how much processing each miner contributed.
The best analogy I’ve come up with is you and 100 people with a truckload of scratch-off tickets. There’s no way to know exactly which tickets will win, so you just scratch each one as fast as you can, and keep the winners. Maybe you team up with somebody and split the winnings, or maybe you go it alone and settle for all-or-nothing on each ticket. But since there’s no way to know which ticket will win, there’s no racing after one specific ticket in the pile.
Did that make sense?
Can someone here explain (in basic, non-technical terms) what "Blockchain" is, how it works, and the advantages of using Blockchain as opposed to existing software programs that are used to track financial transactions?
(I'm sure there are others here who are as confused by this as I am.)
Because the US dollar is so sound?
How much are they going to increase the money supply this time around?
We have money backed by $20 trillion in debt. Tell me that is sound.
My first purchase was at $86. And I thought I had missed the boat.
I know it can go to zero tomorrow. But I’ve pulled enough out over the past year to pay off all my debt.
I do not reccomend it at this moment. People who think they are going to get rich today are flying in and they are not used to the volatility. I’ve seen kids putting their school loans into bitcoin, and they really have done some damage to their future.
I think the technology will be revolutionary. Do I think “bitcoin” specifically is going to rule the world? Nope. But some form of the tech will change the way finance works.
thx...
It works similarly to a wire transfer.
The sender and receiver agree on a transaction. (The value of that transaction is not relevant for this example.)
So you have Key # 1 nd Key #2. Then you have the transaction code. The transaction is sent to the blockchain. “Miners” review the transaction against the balances of the Key # accounts. If they can confirm that both accounts have enough “coin” to fund the transaction, the transaction is approved and written to the global public ledger and the amounts are exchanged. When the miners confirm the ledgers, they are rewarded with fees and more bitcoin.
Once there are enough confirmations, the transaction is confirmed and irreversible. So, there are no chargebacks and, if you entered your amounts correctly, there are no transmission errors.
The wire transfer mistakes and legs make the traditional process expensive and slow. Bitcoin, even on its slow days, is faster than a large commerical wire. Most “wires” these days are ACH transactions that occur overnight.
This is a very simple explanation for people who don’t get it. They key is that the process is fast, friction less, requires no “trust” and most importantly, no third and fourth parties.
Once you receive the bitcoin you can immediately convert it to fiat at a price significantly less than a stock transaction or a currency exchange.
Cryptocurrency is here to stay.
Those who call it a fad are like the ones who called the Internet a fad back in the mid-nineties (like one man I worked for in 1995 who owned a computer networking business).
The cost to manufacture and protect traditional paper currency from counterfeiting is getting too expensive and difficult. Coins with metal content have tangible value, but this is not fiat currency (when valuation is based on the metal value) and requires the existence of sufficient assets to supply them.
Fiat currency has value because governments accept it as payment for taxes. And taxes are inevitable.
Governments are slow to adopt cryptocurrencies because relatively few people understand them. But, with a growing acceptance, governments will begin to adopt them.
Bitcoin mining requires special computer processors.
You may be mining something on a PC, but if you are mining bitcoin you would know it. The processors kick off a ton of heat.
No one is grabbing your video card and mining bitcoin. Maybe one of the alt coins, but that is not what is being discussed.
How do you liquidate bitcoin into dollars without triggering a tax red flag? That was always my concern.
Exactly. I used to say, in the early 70’s to my fellow high school students, that if the government didn’t honor your US Savings bond, that would be the least of your problems.
That’s the thing here. If government money collapses, it is a “lagging” indicator, and it may be the least of your problems. If Bitcoin collapses, it’s just another market collapse.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.