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Chart Of The Day: Is The ECB Responsible For The Second Coming Of BitCoin?
That precious metals are not the best friends of central banks, whose sole provenance is in creating, and lately massively diluting, faith-based fiat currency is no secret, especially not after the recent snafu involving the Bundesbank and its shocking gold repatriation announcement which came in direct refutation of its public statements just 2 months earlier about faith in the NY Fed this, and bashing of a "phantom debate" on the safety of gold reserves that. Yet it was not gold gold, silver or even tungsten that was the object of derision in an amusing paper released by the ECB in early November titled "Virtual Currency Schemes", which we profiled at the time, but rather the decentralized electronic currency BitCoin, which was supposed to highlight what, in the eyes of the Draghi-led Frankfurt institutions, is nothing but a Ponzi scheme.
Why the ECB suddenly felt threatened so much by Bitcoin, it felt an imperative to issue a 55 page paper decrying such electronic currencies we will never know. What we do know, however, courtesy of a reminder by Bloomberg's Max Raskin, is that since the publication of said paper, the value of Bitcoin as tracked by the Mtgox exchange, has soared some 40% in just under three months, from a "fiat equivalent value" of $13 to a most recent closing price of $18.50, and has doubled in the past 12 months alone.
So one wonders: after soaring to an all time high of $30 before crashing concurrent with the epic May 1, 2011 takedown of silver, was none other than the European Central Bank responsible for the recent second coming of BitCoin which is now slowly but surely creeping back to its all time highs, and what happens to all alternative "virtual" currencies once BitCoin returns to all time highs: will the Fed, the ECB, and the BIS have their hands full with pushing gold lower to care too much about this electronic currency, or will their attention then be diverted away from the daily precious metals smackdown to focus on this threat that at least in Europe is so large, the ECB itself had to chime in?
More from Bloomberg:
The CHART OF THE DAY shows that bitcoin has more than doubled in the past 12 months, strengthening to $16.37 from $5.88, according to data from Mt. Gox, the world’s largest bitcoin exchange. The money, issued by a decentralized network of computers, has recovered after falling to $2.14 in November 2011 from a high of $29.58 five months earlier.
Greater demand for virtual currencies could have a negative impact on the reputation of central banks, according to a report published by the European Central Bank in October last year. Since the report was released, bitcoin has risen more than 55 percent against the dollar and use of the currency has surged.
Bitpay Inc., a bitcoin payment processing company that recently raised $510,000 in an investment round, this month announced that the number of companies using its services has increased almost 50 percent to more than 2,000 since November, when blog management firm WordPress.com said it would accept the digital currency.
I think the ECB obviously is concerned, and it’s not reputational,” said Steve Hanke, a professor at Johns Hopkins University in Baltimore who helped to establish new currency regimes in countries such as Argentina and Bulgaria. “I think it’s a competitive threat. Maybe virtual currencies will be so convenient that they will pose a threat because of their ease of use.”
And as a reminder, for pure comedy value, here is the ECB, again, defining what a Ponzi scheme is without referencing itself even once:
A Ponzi scheme is an investment fraud that involves the payment of purported returns to existing investors from funds contributed by new investors. Ponzi scheme organizers often solicit new investors by promising to invest funds in opportunities claimed to generate high returns with little or no risk. In many Ponzi schemes, the fraudsters focus on attracting new money to make promised payments to earlier-stage investors and to use for personal expenses, instead of engaging in any legitimate investment activity
Listen to the ECB: if nothing, it certainly is an expert on the topic of Ponzi schemes.
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'leet, indeed. Thanks, bud.
"if you don't hold it, it doesn't exist" isn't applicable to money.
If someone claimed bitcoin as cash, perhaps it would need a physical manifestation. But *MONEY* can be intangible (0's and 1's, FX) or tangible (FRNs, Euros, Yen, bars, ingots etc.)
Chart of the Day, bitchez!
First they ignore it.
Then they laugh at it.
Then they fear it.
Then it wins.
I presume that "it" is gold or silver in the eyes of the FED.
IT is the aysmptote.
First they ignore you. Then they ridicule you Then they fight you. Then you win
-Gandhi
Once the FED starts with the ridicule of bitcoin it will be a reaffirming backwards acknowledgement of it's effectiveness.
OK, so there's the solution - USD backed by bitcoin.
I've been using Bitcoin since Jan 2011, I figured if a currency could be stateless so could I, so I did in 2012.
Coincidentally, this morning (before this article appeared) I saw a Bitcoin mining ad here on ZH from Butterfly Labs and decided to investigate.
Very interesting business there, and the idea is too.
If it crushes banks and central banks I'm all for it.
Caveats:
I'll stick with Gold and Silver I physically possess, but best of luck to those of you who advocate them; especially if it kicks the ECB, the FED, and the Banksters in the nuts.
Sources:
http://en.wikipedia.org/wiki/Bitcoin
http://www.butterflylabs.com/
http://www.zdnet.com/blog/btl/bitcoin-a-guide-to-the-future-of-currency/...
From the bitcoin.it wiki:
And this, in a nutshell, is why I am very hesitant to use bitcoin. Anyone who can flash crash the NYSE or bot their way around market moving nanotrades has a hop, skip, and a jump to crash into what is quoted above. At least in the market, I know what I am getting into on any given day. Bitcoin still seems random and devoid measure. Sure, I'm still trying to figure an acceptable risk level, but for now, it's just a duck that moos.
Pushing trades in nanoseconds and calculating hashs are vastly different problems.
As of now, you would need like the top5 world biggest supercomputers to be able to outcompute the bitcoin network. Once dedicated chips (ASICs) get available, such a cluster wouldn't stand a chance.
unless you create your own dedicated chip cluster, which wouldn't be a problem if you had virtually unlimited funds
There are two problems with someone trying to take over the Bitcoin network:
1.) No one entity in the world has enough computing power to do it now. That chance has passed.
2.) Anyone that had that kind of computing power would still face a sort of Gambler's Ruin scenario as they'd have to expend enormous amounts of time and energy to maintain their hold on the network. Their own holdings in bitcoin, along with everyone else's, would drop when word of the network attack was known and miners stop relaying blocks from controlled nodes.
Too few people understand this point: Bitcoin was designed to be a poison pill in case of the network being co-opted. That's some Bene Gesserit shit.
Mining gold and silver also uses a lot of energy.
In the winter i heat my house with my bitcoin mining rigs. It's nice to have free heat.
The reason most people dismiss Bitcoin is because it's a FIRST OF IT'S KIND technology, just like internet was once upon a time when everyone and their grandmother dismissed it and though it would lead to absolutely nothing.
And as a first of kind technology if you lack the proper computer science knowledge it's really hard to wrap your mind around the highly abstract concepts that are all wrapped into a brilliant whole. Not the least of all the various missconceptions is that one where people think Bitcoin is a digital currency. It's not just a digital currency, actually
Bitcoin is a money system with a digital currency used by people who run a free open source software that connects them to each other and regulates this currency.
And what it allows you to do is to:
- instantly
- without having to pay enormous fees
- without having to worry about fraud or currency debasement
- without having to ask anyone for permission
- without being obligated to identify yourself
- transfer any amount of wealth to anyone, anywhere, anytime
And it's the only method that allows you to do that right now on this planet.
Yes, but when the Russian Mob and Chinese Military figure out how to hack into the transactions your Bitcoin could lose 99.9% of it's value overnight.
And don't think for one second that all that talent on Wall Street running algo HFT centers won't fuck with it either.
If they can "hack into Bitcon" they can hack any military installation because the security encryption algorithems used are the same(not to mention all the online banking and government secrets), so I think if you are right and that can happen we have way bigger issues than little ol' Bitcoin.
But there is nothing to hack. There are no servers, there are no offices, all there is is a BitTorrent like peer to peer network of people using an OPEN SOURCE(do you realize what this even is?) software. And al I have to ask you is, don't you think a code that everyone can read and change wouldn't have millions of dollar being poured in if it weren't ironcald secure?
EDIT: but please, don't take my word for it, I'm just a bitcoin enthusiasts.. Look, here's the code: https://github.com/bitcoin/bitcoin now go and hack it, there's a ton of money waiting for you if you can.
*sigh*
Yes, I know what it is.
I remember when 64 Bit was considered secure and lent my computer to Tucows to show how insecure it was (cracked a DOD code or something like that in 24 days when they thought it was uncrackable).
Did you read my post?
Tell me how a system that depends on the exchange of binary data and unique codes using computer hardware cannot be corrupted by binary data and unique codes using computer hardware?
Just asking that you take a grain of salt with the slice of beef, which I'm sure is delicious and of the highest quality and which I support if it chokes the banksters - I just don't want to see good people caught with their pants down by TPTB.
Neither do I, hence why I, when I first heard about Bitcoin in 2011, investigated the software and questioned the devs for 14 days straight before I understood why it can't be tempered with. Hint: it has to do with cryptography and a distributed public ledger.
But by all means, do not take my word for it, listen to Udacitie's MIT professor:
Bitcoin
http://www.youtube.com/watch?v=CdsS8jFVv2c
Bitcoin Solution
http://www.youtube.com/watch?v=2qY0elXs5Xg
Provide Scarcity
http://www.youtube.com/watch?v=zJxVXyvccgI
Nothing on this Earth is tamper proof or foolproof, NOTHING.
Realize that these fine people are promoting what they do and what pays their bills.
They could be honest or not. They could be right or they could be wrong. They may be the smartest person in the room, or not.
If you want to bet your hard earned money on their "foolproof" invention, I wish you luck.
Gold, Silver, and Land that I physically possess and can defend with my guns is tangible. I can die defending it, and I know it is there.
Anything else is a crapshoot; especially anything requiring electricity and the Internet, which are both controlled by TPTB.
I'm just suggesting you not put all your eggs in an ethereal electronic basket.
To each his own.
Mate they are already tampering with the fiat price of your gold. They turned gold into another fiat by creating all sorts of "paper gold" investments in order to manipulate the price. That and their naked shorting, and they can take the fiat price anywhere they want. You may not mind if your bank and your grocer accepts physical as payment, but probably they do not.
Maybe if you handed them one of these chunks:
https://www.valcambigold.com/category/51-combibars-info.aspx
How long until a BC ETF with infinite paper shares shows up?
Btw whoever wants to listen to the entire lecture, you can find it here: http://www.youtube.com/watch?v=CdsS8jFVv2c&list=EC146831BEFADFE152&index=49
Neither the Russian mob nor the chinese military needs to "figure out how to hack into the transactions" as you I'll tell you. Gather up enough hashing power to carry trick the network into double counting some enormous transaction. In order to do this, you would need more computing power than SETI, FOld at home, and other distributed computing processes. Methinks TPTB's supercomputers are already mollified.
There's nothing you hysteric metal bugs will think of that crypto-nerds haven't. You might as well put your gold on ebay, while there's still sheep who think it's levered to the global balance sheet.
No! Use gold, I do too! Most of my savings are in gold. Some of it I've put into silver and some of it I put into bitcoins which I use for the super convinient online spending.
But gold's value and utility is timeless and I would never advocate against it's merits, never.
Diversification is for chumps.
Enjoy smuggling your precious metal horde, through the metal detectors and geiger counters ensuring no transportation of hot metals.
This is crap,
There are no problems taking PM's through metal detectors. Just show the security doods what you have, try not to make them jealous and keep walking.
Don't be a pussy, handling any sort of money has risk, just try walking down the street at night with a wad of cash in your pocket and see how comfortable you feel.
(On the other hand you could just carry a memory stick)
If you arent comfortable handling your own money in your own way just keep using those electronic ones and zeros.
Man up, or bow down, the choice is yours...
Your assuming I am referring to TSA metal detectors.
True I am assuming that
What are YOU referring too?
If I can't drive it over a border, I sure as hell am not flying it anywhere. Public flying is for Plebeian masses and so Big-Bro. And moving it from one continent to another, that has tricky logistics and costs also. Do-able, but tricky and takes margin out of PM.
good for you
most here dont understand the difference between storing, hoarding, accumulating wealth and exchanging value for value. methinks you're wasting time trying to convince those who cannot grasp the diff b/w these two simple concepts, wealth vs. value.
Of course TPTB could intercept counts, and insert false ones, or insert double counts.
Remember that the Internet started as a military resource; no reason they couldn't pull the plug on your transactions.
Identify IP's processing Bitcoin transactions and block them, etc.
Just sprinkle a little caution, prudence, and humility in with your intelligence and energy and you are less likely to have a tragic downfall.
You should join us on the darknet.
www.ZeroHedge.onion has a nice ring to it!
Thanks for that, agree.
I think we are all united against the Central Banks and Bankers (thieves).
> Of course TPTB could intercept counts, and insert false ones, or insert double counts.
I could see how people would believe this if they haven't studied the Bitcoin protocol. On top of being a payment processing network, a currency and a network protocol, Bitcoin is also a triple-entry accounting system. A crowd-sourced public triple-entry accounting system at that.
You can see the ledger here:
http://blockchain.info
Um...K
Maybe there are some other things that you don't understand of which you'd like to offer an opinion? I'm all ears.
Tripple accounting, double-fudge, single scoop.
All they have to do is pull the plug on your connections, your sites, your servers.
Raid the offices, shut down the servers, filter the access, or just declare it a subversive act and jail anyone participating in it.
You seem to underestimate the ability and willingness of TPTB to defeat anyone and everything related to the free market.
Anything on the Internet, the Ethernet, the matrix - is revocable, controllable, and defeat-able.
Name one thing besides DARPA and the military controlled nodes and backbone of the Internet that has lasted more than 30 years.
If you are betting anything on the ethereal nebulous and ultimately Government and Military controlled Internet (Ethernet, inter-webs, holy church of the blessed binary sepulcher) you are betting on something that can be gone tomorrow, in the blink of an eye.
Not because I don't support the idea, only because I believe in your spirit yet see you constructing wings of feathers + wax and flying too close to the Sun!
> Raid the offices, shut down the servers
There are no offices or servers to raid. P2P networking is serverless.
> You seem to underestimate the ability and willingness of TPTB to defeat anyone and everything related to the free market.
I'm well aware of the ends they'll go to. Bobby Kahre, Gordon Kahl and others robbed and murdered by the Feds for being better men than the Feds. Remember that you're not the only one with a sense of history on this board.
You seem to underestimate the power of the free market to defeat TPTB in the long run. Bitcoin is a creature of the free market and is taking root before the eyes of the helpless powers that be. The only thing they can do is shut down the internet. If the internet is shutdown, we have far bigger things to worry about than a sub-billion dollar payment network/bookkeeping system going offline.
Quit being afraid of TPTB.
I am not afraid of anyone or anything.
It would be easy for TPTB to shut down access to all but banks and grocery stores; allowing people to get "cash" from their EBT or bank accounts and get food and water - yet lock out any and all transactions - whether considered "subversive" or seemingly innocent bitcoin ones.
EASY.
> It would be easy for TPTB to shut down access to all but banks and grocery stores
They'd have to shut down the entire internet. It's not that easy.
I feel bad for people that don't have a working knowledge of computing science. It could make the next four or five years easier if they did.
I understand it fine; off = 0, on = 1
If there is no power there is no 0 or 1.
Historical references for your seeming inability to comprehend fallibility:
I do wish you the best of luck but I do wish you would question your assumptions for one billionth of a nanosecond.
Of all of those things you mention, only Bitcoin has survived its crashes. It's survived because it's a viable currency, not because a state or a state-backed corporation is holding its hand and wiping its bum like Bennie does with the FRN.
If you're afraid of Bitcoin, you're afraid of math. Rather than dismiss it out of ignorance as you appear to be doing, at least read the white paper written by the developers:
http://bitcoin.org/bitcoin.pdf
That's the point; math is defeatable by math.
I agree with you about Bennie and the FRN, for sure.
You must realize that Bitcoin is defeatable using the same tools used to create and use it (?).
That is the point. Math is the most fallible of all sciences; competely defeatable and reducible - ultimately zero certainty and security because of it's certainty.
It is either on or off (0 or 1), just like the electricity supplying the computers and Internet, and the Internet nodes, and the servers, and routers, etc., etc., etc.
Any system created by binary data and mathematics can be hacked, corrupted, confuzzled, defeated, destroyed by the very same binary data and mathematics.
All that is really necessary is for TPTB to corrupt a few large transactions and dissolve trust and Bitcoins are history.
I don't want that, however, you are building castles in the sand.
> Math is the most fallible of all sciences; competely defeatable and reducible
You obviously are unfamiliar with the math behind cryptography. The crypto behind Bitcoin can't be broken at the moment because it would violate the laws of physics. There's not enough energy in the universe to crack modern crypto with the computing methods we use now. This is simple, mathematical fact.
This is Dan Kaminsky on Bitcoin, its good points and bad. If you don't know who he is, look him up:
http://youtu.be/gQoykhNoBbY?t=2m39s
Kaminsky has more cred than you do. Sorry.
I dub thee "Enigma".
It would take a computer made out of something other than matter, existing in something other than space, to even begin to try to brute force any of the encryption used for bitcoin.
You can't brute force private keys and get the balances, the keyspace is way to big, and not all of the keys have anything of value in them.
It is really alarming when I read all these responses, its like math, logic and critical reasoning don't exist anymore.
Math, logic, and critical reasoning are tools. The tools can be broken by chaos, by legerdemain, by skullduggery, and by themselves. All these wonderful sciences have become a religion, and they require faith. You obviously have a lot of faith in math but it is like having faith in a calculator. Calculators can be broken. Just as you can multiply 2 X 2 to get 4 you can add 2 + 2 to get 4, or divide it by 2. Everything "built" by math can be destroyed by math, as math is only a measuring stick for reality, it doesn't "build" anything.
And you don't seem familiar with it either: http://www.dslreports.com/forum/r27253100-Hack-Proof-Cryptography-Cracked
AES must have been chosen over bitcoin's SHA for a reason, yet the ongoing and advancing efforts to crack it are there to prove it won't be safe forever - you just need the time, resources and patience to find it's inherent flaws and then it will go the way of the Dodo, just like good old DES.
i really dont know what your problem is
w/o any doubt you're using fiat paper currency - yet, the banksters can pull the plug on it at will. any time. wipe out your bank account, steal your investments, devalue your "wealth"; and yet here you are arguing against something that is inherently more secure than fiat, paper or digital. as of today, nobody controls bitcoin. until that time, bitcoin is a better alternative than the fiat currency you use every day for all transactions, fiat currency that the hofjuden control 100%, fiat currency that is manipulated every single day, etc...
Please read my post above and for God's sake (and your own) don't trust anything over the Government controlled Internet.
figure out how to do that without using gobs of nuclear energy to mine it and you might have some more converts.
The energy spent on mining is the mining that is required to keep Bitcoin secure, without it there is no Bitcoin hence why it is a first of it's kind technology and why nothing else like it exist. It's an essential component and the sooner you realize this the faster you can start enjoying it's benefits.
thanks, but i understand all that already. an essential component is an energy-intensive process, is it not?
Yep, it's how the limitedness of bitcoins and security in Bitcoin is provided for.
don't get me wrong, i dig the concept of it. when i become a net energy producer, i will be happy to use my excess to join the mining crew, if only for the sport of it all. but not quite there yet...
Getting gold out of the ground is also a net loss of energy. Have you thought about that? I mean I respect your reservations, when it comes to money people should do their research before starting to use a new tool that deals with it but your objection just isn't valid. Anyway, here's me hopping that one day soon Bitcoin can also make your life a lot easier.
i have, but where did it say that i own any gold? maybe my objection is not valid because your assumptions are not?
I see a trillion bit platinum coin....
I see bitcoin easily surpassing the price of silver in 2013..
I"ve been tempted to start running the client, but... don't know if it would be worthwhile.
Does anyone here USE bitcoin for anything today?
Don't bother with the official client unless you've read this page: http://bitcoin.org/clients.html
As you can see, there are more than just one client, and the one that's on the main page is very inconvinient, you are far better of with one of the other options or for small amounts maybe even a theoretically slightly less secure ewallet client like http://blockchain.info which is really easy to use.
I play online poker with bitcoins.
The elite hate competition..
Whether its counterfeiting, drugs, etc..
One could argue that the problem with gold is that it cannot compete with fiat, and we just need to look around us to see that. If gold is so superior then why isn't everybody using it? The world has been waiting for someone to invent something better than gold and fiat. If you do not think something better is possible then I challenge you to imagine more.
No the value of Bitcoin has nothing to do with ECB publications. It baffles me a bit how people who are ment to be economic experts cannot understand why the value of Bitcoin increases so drasticly but more importantly why Bitcoins are so valuable.
If you know anything about economics and value you will know that Bitcoin is about the most perfect species of money we could possibly hope for at this point in time anything better would be a future were there is no need at all for money.
Bitcoin is absolutley perfect in its design and its effect, if you want to do somthing useful then adopt it and start using it.
You are far too sure of yourself and fantical about bitcoin. Bitcoins already crashed in value, there have been hacks and people have lost every bitcoin they had.
People should/could use it but sparingly. The bigger it gets, the more of a target it becomes. Have you ever been in a blackout?
In my opinon the most perfect species of money there is is trust. Without it there is no money. Credit, money, trade, economics, finance used to be based on trust. Humanity lost that and until it is regained there is just the present chaos.
I am sure of myself, its paid off a fortune also. Trust is an aspect of money but it is not money itself, it cannot be digitally transfered as payment unless its put into a specific medium.... oh wait...
So like any species of money it has to gain trust and bitcoin will and is gaining trust so it ticks that box as well as many others.
But for people who do not truley understand economics and value they will have to contiune to be baffled by the ever increasing value of Bitcoins.
Why have Bitcoins increased in value?
Because people percieved they would have greater value in the future and be able to buy more stuff with them?
You say Bitcoins paid off a fortune. Did you have massive dollar denominated debts that an investment in Bitcoins allowed you to pay off? If so how is that any different than any other gamble like Netflix stock or any other bullshit scheme humans have come up with since existence to get out of having to labor to pay off debt?
If you indebted yourself by purchasing more than your labor could afford, the only recourse for paying off the debt is labor. That is the system that should be adopted. All leveraged bullshit and fiat currency should be abolished. Credit extended as units of labor to be repaid. Not pieces of paper to be discharged if a bet goes wrong.
If you hold ten Bitcoins and the value doubles, did you do anything yourself to increase their value? If the value increased without labor, there is nothing different between Bitcoin and bullshit stock that makes any scumbag rich overnight if the market goes his way.
Early Bitcoin enthusiasts are very proud to hold their virtual fortunes over the heads of others. Procaiming the other people should have been smart and got in at the start, if so they would hold a huge virtual fortune as well. Sure seems to be a lot like Lloyd Blankfein saying he is doing God's Work.
I'm really sad for you. You know fiat is toilet; and you know bitcoin could be the next major thing; yet you put enormous energy trying to downplay it. It's funny, actually.
trust... Without it there is no money. Humanity lost that and until it is regained there is just the present chaos.
hallelujiah
so what
as if people have not lost every fiat dollar they had to hofjuden, thieves, burglars, shitty fin. advisors, gubermints, scamers, corzines, madoffs, etc
I never really cared for bitcoins but that May 2011 pattern following silver has me worried...
It takes a special kind of mind to be convinced of the omnificence of HFT super-computer-weilding banksters being able to "destroy the bitcoin factory" ... those same rocket scientist banksters who collapsed the global financial system.
But then this is zero-hedge, home of the bitcoin laggards, sigh. I used to have hope for this place.
For Bitcoin to work, its value should never fluctuate. The idea that a Bitcoin can double in value, compared to fiat, only serves speculators who hope to run the value up in order to cash out for a greater amount of fiat. In that way it is a Ponzi scheme.
If you wish to exchange one unit of labor for one Bitcoin, and the currency allows items to be bought at equal rating to labor, then I don't have a problem with the system. If it takes 100 units of labor to produce an item, it should cost 100 Bitcoins.
The idea that one Bitcoin was worth $1 or so, and was then valued above $30 in just a few months scares the hell out of me. It looks like the same people who chase momentum and drive stock values to ridiculous valuations got behind bitcoin. Another scheme to generate massive wealth without labor. Bitcoin should never be allowed to exchange for any other currency.
I understand Bitcoin was modelled after gold. That a set amount of Bitcoin was created and the coins would be "mined" as more Bitcoins are mined it becomes harder to "extract" thus causing the value to rise. The issue is there is no real labor invloved in mining Bitcoins, just time and computational power. Like those who own the mines, Bitcoin will always favor those who can afford cutting edge computers. Imagine Goldman Sachs turning their HFT systems to Bitcoin mining.
Barter is still the best system. One person creating something of value to trade for something of value produced by another. All representative forms of money will end in total corruption.
Computational power isn't labor? Has an internet connection, computer hardware and a lot of electricty all of the sudden become free without anyone telling me?
If it doesn't take any labor to issue bitcoins, go right ahead and start doing it, at nearly $19 a pop you should be earning mirrions in no time!
The only labour it seems... is going to work for your country's current currency in order to pay the electricity, internet bills, and hardware maintainence. Then you just let the BitCoin softwares do the work in the background while you leave your computer on as you go to work outside the virtual realm. You'd be leaving the computer on while you read, trade, or play some games. It really doesn't seem like labour, more like a derivative of real labour.
Unless you consider being some professional hardware jockey who tries to full time rig up super computers to pump out bitcoins.
anyone that has actually set up a bitcoin mining operation will tell you that it takes one helluva lot of labour and specialized computer skills to set it up and run it. it also requires investing in very high end computing equipment. not anyone can do it (with any efficiency).
think of bitcoins this way.. you buy things in the real world with cash, you use bitcoins for online transactions and you save with precious metals.
the real reason that the bitcoin value has gone up lately is because the payout structure has been changed.. in other words, the payout has decreased for the miners, therefore the bitcoins are worth more.
A bitcoin has always been worth a bitcoin. Scares me that a US dollar has fallen in value from B0.16 to B0.05 in a year.
Gold is getting cheaper too. Gold had dropped from B291 to B87 in th last year.
Things I like about bitcoins: decentralized and not easily controlled by the banksters (yet).
Things I don't like about bitcoins: dependant on a working power grid and a series of tubes to be able to use them.
I honestly don't have a lot of faith that there will be a working power grid and/or a series of tubes for that much longer.
Then Bitcoins and the modern society isn't for you!
It should concern you that your strongest argument against bitcoin is the entire GLOBAL infrastructure would have to be damaged. Because that is what it would take.
So, going to such extremes makes sense? Or is it just somone clinging to an old system, afraid to acknowledge the sands are shifting around them?
It really baffles me that anyone could believe that bitcoins would guarantee price stability any better than fiat currencies.
I mean, isn't the chart in the article explicit enough?
You are missing the point. Price stability is not what bitcoin is all about, being able to:
- instantly
- without having to pay enormous fees
- without having to worry about fraud or currency debasement
- without having to ask anyone for permission
- without being obligated to identify yourself
- transfer any amount of wealth to anyone, anywhere, anytime
is.
Bitcoin is tragic-boating-accident-proof. I want no part of it.
Hacked:
http://www.dailytech.com/Inside+the+MegaHack+of+Bitcoin+the+Full+Story/a...
http://www.theregister.co.uk/2012/05/15/bitcoinica_hack/
http://buttcoin.org/has-bruce-wagner-pulled-off-the-financial-biggest-sc...
all these little scam operators are consistently going bust- or claiming someone else hacked me. Bullshit, you hacked yourself. Notice how cops never get involved? Notice how a police report is never filed?
Best way to play bitcoin- open an exchange and then claim back fees by your CC processor, someone I noticed did that and now he bought property in SanFran and is renovating it for a live/work office space/incubator. Interesting how a young punk can lose a company and capital then just buy a old building 2 months later. (TradeHill CEO Jared Kenn)
http://arstechnica.com/tech-policy/2012/02/major-bitcoin-exchange-shuts-...
This is not a savior currency- sure throw a few grand into it, treat it like a junior minor but don't be surprised if it is toast 1 day and don't get too concentrated in it, you could have invested in madoff and made money- just know when to get off the boat.
Bitcoins follow basically the same rules as your cash. Trust someone shady with your bitcoins that your commnon sense should have told you to never trust it's your own fault if you get robbed.
Research, research and do even more search, don't trust anyone on face value, not even me, with your money and Bitcoin can do amazing things for you ;)
Bitcoin itself has never been hacked. It uses encryption equivalent to 3072-bit RSA. Bitcoin itself is rock-solid.
https://en.bitcoin.it/wiki/Myths#Bitcoins_are_worthless_because_they.27r...
The problem is that some early users have been ripped off with different schemes and tricks. You don't blame the US dollar because Madoff and Enron used it for their scams.
Wow billsykes, you're really bad at reading AND COMPREHENSION.
What you're pointing at are EDGE EXCHANGES, and hucksters, not the bitcoin PROTOCOL. Get it yet? Is it sinking in?
According to your flawed reasoning, the dollar is "hacked" because HSBC uses it to money launder, or thousands upon thousands of dollars get CORZINED.
You know what? Please don't use it, I don't want billsykes to have the yield I'm enjoying, or the security, or any of the other benefits.
Buy all the STAWKS you can, and please, keep all of your cash in Bank of America.
You deserve the results.
Bitcoin is rising exponentially against gold and silver since it has been exchange traded...
www.bit-day.com
BitchCoin Rules!
Currency units like 'Sovereign fiat' and Bitcoin both have their place and uses. In both cases, they must eventually be traded for REAL assets, i.e. Primary or Secondary wealth. I don't 'go-zealot' on any of these, but see them as parts of my Tool Box.
The ONLY concern/nightmare I have is: If TPTB one day decide to force their version of Bitcoin down our economic throats, and the RFID-based Bitcoin chip up our... That would 'suck'. And be so "666" of Bankfine & Co. He'd then not be "doing God's work". Unless his real god is The Fallen One.
It's glass boxes and black boxes boys......bit coin is the new standard in total transparency.. The ethics of the true open source movement should be moved centrestage after the big reset to all aspects of finance..
Yes and whilst your at it give ubuntu Linux a run and discover why your looking at your google search results 40 seconds after you switch the box on... And savor the delight of browsing without risk of malware or virus and no antivirus software utilizing all your ram and processor speed..
bit-con
I'll take bitcoin any day over anything you're into.
Please, don't get into it Papasmurf, I'd like to enjoy the benefits myself.
Thanks,
xoxo
Sometimes when you scan over a headline you have mysterious but interesting thoughts.
In the article BitCoin is a digital currency form so again nothing new there, no real tangible asset.
Here is an alternative BitCoin concept for you to ponder ...
You buy part of a precious metal coin so 100 people each have a 1/100 share in say a krugerand. As a bit "of a" coin it has a tangible asset and not tied into the fiat ponzi scheme. Then you can trade the shares in these coins to purchase everyday items.
Personally I like the concept, you have one hundred shares you get to have the single coin to take home too:-)
Brilliant fiat is dead.
risky scheme - not safe like social security
I`ve voiced my unease with Bitcoin... even more so now. What is it that the Bitcoin mining software crunching?
Seriously, is there any way to find out what the thousands of greed motivated (and alternative money inspired) high powered distributed computer processing power is crunching?
Think things like World Community Grid - they feature things like AIDS or SETI @ Home...
But Bitcoin? All it's doing is crunching some random calculations or something to create BTs? It's too good to believe on my part. Maybe I'm not searching the Bitcoin.org site hard enough for an answer.
More sinister example would be say a criminal wanted to crack some hardcore encrpytion to a lottery gaming site. Could this person theoretically offer a "prize" for people to donate their processing power and crunch away at some encryption? The "prize" would be much less than what would be gained from cracking a lottery site.
Or less sinister , yes it is an alternative electronic currency, but you're still forced to use processing power and hence energy (and also must have internet + a computer) in order to participate...
Did anybody else think of this?
Dunno.
Um, it's not secret... at all.. what the software is doing.
Simplified, it's computing a SHA256 hashes of a block with an added "seed" number, then computing a hash of the hash, and looking for blocks that begin with a certain number of zeros in proportion to the current level of difficulty (which is set by the amount of compute power on the bitcoin net.) The work is highly repetitive, and the hash algo is completely fixed, which is why the work can be converted to hardware (FPGA or ASIC mining.)
So... basically digging holes for the sake of digging holes and counting it as making money?? Or am I way off base?
Well, the SHA 256 computations are to verify the integrity of transactions as well as mining. So you can think of the operation as having two possibilities: one, it comes up with a valid block of bitcoins, or two, it authenticates tranactions. Both require energy, compute time, etc.
So it's not exactly for the sake of digging holes, it's handling the protocol. Like everything else, though, the blocks that satisfy the algorithm are only valuable because people infer value into them via the computational difficult and the desirability of bitcoin. It's digital gold by concensus, if that makes any sense.
It's definitely not busywork -- though the difficulty of the process is adjusted by how many computers are working on it. More computation = more difficulty. The system is self-scaling.
Has anyone mentioned that it is quickly becoming *the* way to play anonymous, online poker from countries that have tried to stop online gambling through control of the EFT system?
Check it out here if you are interested: Bitcoin Poker at Seals
(full disclosure: I am an affiliate and I get credit for referrals)
Its a scam pure and simple- the amazing thing is that it gets press for a 20-40m market cap scam.
Big deal if your bit miner get hacked- 100% investment loss. AND now its not worth even using your regular PC to "mine" since they halved the coins again. Price should be at $25 (its double the work now), as it was nov. 2012 when it changed over- but yet the price is only 18, look at the lag- the lag tells you volumes about this scam.
So same with really small cap stocks they go up and down- 10 bagger junior minors, over 1 drill hole- same thing with bit coin, look at the volume, look at the transaction sizes, small time. If VC's with their dumb money are not even investing in size tells me something.
Ya blah blah blah about regular currency but diversified, its OK- there is nothing in the universe as a constant except change. Even PM's can get confiscated or regulated by govt's into obscurity.
I see bitcoin as a lame way to score some bath salts and other loser type activity. From a risk perspective its a double+ risk issue, risk if the miner pool goes tits up, transaction fees, then you get vendors not delivering your plain brown envelop of drugs and then holding excess BT and the fee(bid/ask+transaction cost).
Go buy a prepaid CC in cash at a store and then go buy whatever.
The only scam is your continued involvment in the financial system, billsykes.
Enjoy your green toilet paper, your Benny-and-the-inkjets inflated stocks, the sinking feeling when you walk up to the ATM to access your money stored on a server in a bank using ELECTRONS and CRYPTOGRAPHY, and realizing the bastards devalued your ass.
Your defense of the status quo just tells everyone how absolutely clueless you really are.
I don't want to keep you from your dinner date with Million Dollar Bonus.
Cheers!
Holy fuck are you ever off. Read my comments. Disprove me. BT is not some end all be all.
You know what? I'd take you a bit more seriously if you could get off the high-horse and the needless "loser" labels. Also doesn't help your position that you think all bitcoin activity is illicit. That isn't true. It is filling the same niche as the dollar, yen, pound, yuan, etc..
It is a network that has value by the virtue of being free. There is no central authority saying you can't buy what you want, imposing restrictions and ridiculous markups to shift your money around.
That is the core benefit - the system isn't part of the politically compromised financial systems we have. Edge exchanges are convenient, but in the end we wont NEED THEM when a majority of services and products are bitcoin denominated.
Even if this first-generation attempt at decentralized crypto-currency/payment system doesn't achieve all its goals, my guess is another iteration of the technology will. Much like how other services on the internet have been refined and evolved over time.
Don't count us out just yet.
I am not counting it off. This is why I stated that you are "off", meaning that our aims (stable, un-manipulated currency, free of fiat) are exactly the same, but our means of getting there are different.
Yours with a very new, unproven (haven't gotten to 21m yet) means of exchange and mine a time tested, proven upreputable measure/means of exchange and wealth storage.
I blame the format for our perceived differences of opinion.
(I don't care about drugs/illicit or licit transactions, I have just never seen anything that would force me to switch from fiat to use bt for.)
I don't know. I used a bitcoin transaction one time and it works just fine from what I have seen so far. Not sure about this BTC price spike though. Disclosure: I have a bitcoin wallet and have recieved two bitcoins to start with eight months ago. For free, because I am a skeptic. I still have 1.5 BTC. Where can I buy a small piece of gold with a 1.5 BTC? Peace. Simply asking.
Try: http://shiresilver.com/catalog/card_products
Peace.
What's the general consensus on bitcoin?
I wonder if it's going to ultimately compete with gold/silver.
Gold and silver are being crushed... www.bit-day.com
I doesn't have to. It won't be either/or, it will be both/and.
Why did it fall with silver?