Posted on 12/02/2013 8:26:08 AM PST by Star Traveler
The developers of bitcoin are trying to show that money can be successfully privatized. They will fail, because money that is not issued by governments is always doomed to failure. Money is inevitably a tool of the state.
Bitcoin relies on thoroughly contemporary technology. It consists of computer-generated tokens, with sophisticated algorithms guaranteeing the anonymity, transparency and integrity of transactions. But the monetary philosophy behind this web-based phenomenon can be traced back to one of the oldest theories of money.
Economists have long declared that currencies are essentially a tool to increase the efficiency of barter, which they consider the foundation of all organized economic activity. In this view, money is a convenient instrument used by individuals to get things done. It is not inherently part of the apparatus of government.
I think of the concept of privately issued tender as “right money,” because the whole idea appeals instinctively to right-wing thinkers. They dislike centralized authority of all sorts, including monetary authority. For example, Friedrich Hayek, Margaret Thatcher’s favorite economist, proposed replacing the state’s monopoly on legal tender with competing currencies offered by rival banks.
(Excerpt) Read more at dealbook.nytimes.com ...
Hey, to some who trade those things it’s still currency. Just not enough people got involved to make it universal. Only time will tell what happens with bitcoin but I’m thinking that something is going to replace the US dollar or any other current exchange. And it will be worldwide.
All fiat currencies are scams.
/johnny
I don’t want any of your bitcoins but I’ll take any dollars you don’t want.
“But if the power goes out, I can’t spend a bitcoin.”
Can’t spend ‘em if the internet goes down either. In fact, if the power or internet goes down I’m not sure they really exist any more. Of course, under those, circumstances the dollar is in almost the same boat, excepting the little bit of actual cash that might be stashed.
The idea of an online currency was predicted in N. Stephenson’s great book “Cryptonomicon”.
Bitcoin is backed by nothing.
FRNs are backed at least by the potential of the US to tax future generations.
“And I’ve heard all these stories on how bitcoin is infallible and safe”
Not safe from stupidity though. Last week a UK guy lost 7,500 bitcoins (then 9 million worth) when he threw out the hard drive that contained them and he had no backup. Buried in a landfill with little to no chance of retrieval.
“A Prediction: Bitcoin Is Doomed to Fail”
So is the dollar. All fiat currencies are doomed. Not a single one has ever survived in all of history.
Bitcoin is a commodity the value of which depends on the supply and demand. The supply is fixed as the formula has a fixed number of solutions. As folks become leery of government manipulations of currency this one seems more reliable.
I say Bitcoin is going to be around for a long time and will become ubiquitous - you will be able to use it in all countries without the need for currency exchange.
You purchased secure cash and it was supposed to guard against fluctuations and whatever. At first the government tried to stop businesses from accepting it, how do you tax it? The IRS didn't know what to do with Secure-Cash certificates. So acceptance from offline businesses was slow.
Bitcoin fulfills a lot of that, doesn't it?
Here’s something from Wired Magazine that gives you some background and history on how it started. However, it’s not a current article as it’s two years old.
The Rise and Fall of Bitcoin
http://www.wired.com/magazine/2011/11/mf_bitcoin/all/
It does. I think one thing those of us who understand prophesy can look to is that soon there will be a one world currency. It will have to be standardized and accepted worldwide with a worldwide distribution tool. I think bitcoin fits that to a tee. So I think it will be bitcoin or something based on the idea.
Gold has intrinsic value because it can be used to construct other things, such as jewelry and electronics. Most of its value, however, is non-intrinsic value, based on current supply and demand.
If you think that gold is an inherently safe investment, you are deluding yourself. Any of the countries with gold deposits or reserves can flood the market at any time (currently, the world's five biggest gold producers are China, Australia, U.S., Russia and South Africa in that order). Alternatively, merely the perception that they might can drive down demand.
Bitcoins and U.S. paper dollars have no intrinsic value. The difference is that the only value that Bitcoins have is supply and demand. U.S. paper dollars are backed by the full faith and credit of the U.S. Yes, that does not mean nearly as much as it used to. But it still means that there is a large nation with the power to tax millions of productive citizens and a vested interest in propping up the value of its currency. The only ones with a vested interest in propping up the value of Bitcoins are people who own Bitcoins and who have not yet sold them.
Bitcoins are at the tail end of classic bubble, just like tulip bulbs in the 1600s and dot.com stocks in the early 2000s. Demand is being driven by the fact that the price has gone way up in a short amount of time which feeds more demand which continues to drive up the price. At some point, the bubble will burst and the price will crash.
If you buy Bitcoins today at $1,000 will you make any money? Maybe, maybe not. You can probably get the same odds betting red or black on a Roulette table.
Will you make as much money as the people who bought last year? It is possible, but almost certainly not. The big money makers in any bubble are the ones who bought before anyone else had heard of it.
Will you lose your investment? Probably, but maybe not. Anyone who claims to be able to predict in advance when any bubble will crash is lying or delusional.
By definition Bitcoin is not a “fiat”. It doesn’t get it’s value via state edict.
Healthcare tokens.
Same paper that said Obama isn’t a liar and that Healthcare.gov is fixed. Obviously a staff with genius intellect..
Soon we’ll see lines on IRS forms asking if we made any Bitcoin purchases and for what value (in USD) so that we’ll be taxed on the purchase(s). And someone will say “That’s none of the IRS’s business” and end up being audited and/or jailed for it. Confidence in Bitcoins will drop and the value will plummet.
/johnny
You just defined ALL money.
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