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Bitcoin Rises Over $500
One day before the Senate's digital currency hearing titled "Beyond Silk Road: Potential Risks, Threats, and Promises of Virtual Currencies", Bitcoin is largely oblivious to any potential regulatory threats, either at the legislative or the city level, where as reported previously the New York superintendent is in a rush to enforce BitLicenses on businesses that accept BitCoin, and moments ago crossed $500 for the first time ever. Instead, it appears that as we also reported previously, the Chinese Bitcoin craze has reached the parabolic threshold, going so far as making Bitcoin an acceptable payment for real estate, which means that while for the time being Bitcoin becomes the alternative inflation protection medium for hundreds of millions of Chinese, all bets on how high it can get are off.
Intraday chart:
1 Year Chart:
1 Year log chart:
Curious where the demand is coming from? A week ago we showed a handy utility, FiatLeak, which shows where the BitCoin transactions are taking place:
Finally, for those curious what a "fair value" on Bitcoin may be, here is what we presented a week ago, courtesy of Global Macro Investor's Raoul Pal:
So yes: Bitcoin is volatile. Very. That much is clear. But what is not so clear, and perhaps a key reason for this volatility, is just what the fundamental, or intrinsic value of BitCoins is when one strips away the pure euphoric momentum to the upside or downside.
To answer that question, we go to Raoul Pal, head of the Global Macro Investor, and his November 1st recommendation to "Buy Bitcoins"(when BTC was $210 so nearly a 100% return in 1 week) which among other things attempts to "value BTC using a macro framework" or, in other words, the first supply-demand driven fair value assessment of BTC.
His take, and price target, in a nutshell:
A fudge, but not a stupid one
Let’s use a broad guesstimate. One Bitcoin should theoretically be worth 700 ounces of gold or pretty close to $1,000,000, if we adjust existing supply of both to equal eachother.
One BTC is currently worth 0.14 ounces of gold.
That gives BTC an upside of 5000 times to equal the current price of gold, supply adjusted. Clearly, I and everyone else believes that Gold may well be much higher than here in the next 5 to 10 years, thus versus the US Dollar the upside for BTC could be multiples of that.
Now, before you shake your head, simply go back to the chart of Gold versus the US Dollar and just recognise that it has risen 8750% since the 1920s. And just remember that Microsoft rose 61,000% from its IPO to it’s peak.
Considering what we know about the world, I personally believe that Bitcoin may well explode in value as more and more people begin to use it.
If you stuck $5,000 into Bitcoins and each Bitcoin did go up to a gold equivalent of let’s say, only 100 ounces of gold (not the potential fair value of 700), then at current prices your Bitcoin stash would be worth $3.3m.
Now that’s what I call a tail-risk option. It’s either worth zero or it’s worth a truly outstanding amount of money.
I bet you never thought you’d see this in a macro publication. But I’m serious. This just might work.
Read on in the attached pdf below (link)
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Indeed. It is headless, heartless, and relentless.
And the state will play Whack-A-Mole until it whacks itself to death, here and everywhere else:
http://www.youtube.com/watch?v=9Lvv7TX2Gyc
https://coinvalidation.com/
They are trying...
What the hell are you babbling about ? Did you raid your fathers liquor cabinet when you wrote this ? He's gonna be pleased you didn't know enough to steal the good stuff. "Software pass the grid"..... ? da fuck ?
This is what i am having a disconnect with - If it is not a store of value and just a medium of exchange, why the obsession on the price appreciation? I get that its a sign of the increased useage, but kind of misses the point when people talk about saving in bitcoins taht are going to infinity.
I would think you would keep as many on hand as you would need for purchases, and really only rely on price stability in an extreme scenario where you need to have a lot tied up for a day or so while you cross borders. I dont think anyone should be "saving" in them, even though that has worked out well. Maybe the limited supply changes this dynamic, but i think its misuse of a "currency"
Applying the term currency to fiat is a misuse. Currency/Money is a tool to transact and log a trade. If the trade is two cows for a big screen, doesn't matter. between the participants the transaction is logged appropriately by the fact one guy has two cows for a big screen TV.
It's not hard. It's trade. People been doing it since day one.
He said: gold is money, bitcoin is currency. You are using these terms interchangably, the post I replied to did not and it is exactly that distinction that I am discussing.
Gold is a material, silver is a material. It is only a representation. It's a Meme. Always been. Change the meme, change the message and by proxy change the direction of a society. we've all seen it to buttress nationalism for years. As to why, I have no idea. People know where they live, if they didn't their mail would never arrive.
It's stick handling an argument basing something is rational when it never has been. People are creative and are just learning how to be rational. Need to bridge that gap so we can all move from the sink hole the unsolvable math problem of infinity at prime plus 1 poses. There is no winning that game. Fight infinity and you'll always lose and discover things that you really didn't want to.
Just like now, because that is the current situation.
"Currency vs. money" isn't a productive way to look at it.
"Money" has three defining characteristics:
-- a unit of account
-- a store of value
-- a medium of exchange
Since we live in the real world, there is no "perfect" money. We use different things as money, and each thing we use embodies each of those defining characteristics better (or worse) than others.
Gold, for instance, is an excellent store of value. In the modern economy, however, it is a poor medium of exchange or unit of account.
The fiat PAPER dollar, is fair to middling store of value (better in third world jurisdictions than in the USA), and up until thirty years ago was an excellent medium of exchange. Governments have declared war on cash in recent years, however, severely reducing its value as a medium of exchange.
The fiat ELECTRONIC dollar is a lousy store of value, for reasons that dont have to be elaborated here. Its digital nature, and the SWIFT network it resides on, made it an an excellent medium of exchange-- at least until the Feds and the IRS started making it difficult for non-corporations (aka Natural Humans) to actually use it as a medium of exchange in large amounts. It was also the worlds best unit of account-- at least until a few years ago. Now that he world is moving to bilateral currency swap agreements, the dollar's usefulness as a unit of account is under attack.
BitCoin is, well, up in the air right now. It's volatility against other forms of money implies that it is an uncertain store of value; but it's obvious excellence as a medium of exchange means that it HAS meaningful value; so we can conclude that it will be a useful store of value at some point in the future.
The reason BitCoin exists is because the fiat electronic dollar is turning into a piece of shit. The dollar had real value in all three monetary dimensions at one time, because the US was a free country. But that's over. Since commerce wants to be free, it found BitCoin.
Practically speaking, as a 100% reserve currency, Bitcoin needs a market cap large enough to handle many large business-to-business transactions (much of that locked up in escrow) while simultaneously handling worldwide personal transactions and some personal savings.
You can see how bitcoin stacks up against other payment transaction services here:
http://coinometrics.com/bitcoin/btix
and against other nation's M1 money supplies here:
http://coinometrics.com/bitcoin/bmix
https://en.wikipedia.org/wiki/False_dilemma
That's exactly why the current system doesn't work. It's built to answer itself and never provide a concrete solution. No idea why people junked you.
"So say my bitcoins are worth $700,000 a pop, and my hard drive crashes, what do I do?"
You (or your family) should publicly bludgeon you to death with it.
Here's a zany thought : if you have any thing of value on your computer, back it up. If you own more than $20 of Bitcoin on your drive, walk into a Radio Shack and plunk down $12 for a couple or three USB thumbdrives. Back up your wallet, then keep at least one of those backups out of your house. Next issue?
So say my bitcoins are worth $700,000 a pop, and my hard drive crashes, what do I do?
Did you ever consider backing up your harddrive?
Yep, and I remember silver rapidly rising up to $50/oz.
There are no ETF strategies to hamstring it...because there is no method to translate 21 million limited coins that fall past the other side of the decimal point. Once in place, gold and silver will be properly priced.
...in BtC. Then we can all get on with the business of doing business and building stuff. Put the power of the money back in people's hands, make governments solvent again, give businesses options that are less bank oriented and more DIY...same for community groups. It also remedies the crippling and horribly unfair practice of kneecaping countries with FX exchanges.
A BtC in Venezula or Peru is the same BtC as in NYC or London. It forces proper price action on goods to location without a tariff situation. And if governments want to print BtC...they can. It will drive the technology curve faster than before because what is mined now can only be mined now, the machines to finish all 21 million haven't been invented yet and won't be for 50 years.
It's a currency reboot for everyone with the added value of being merit based. aka Work talks and bullshit walks.
And since the past decade has been particularily unkind to the nerd herd of the world...consider it a life long career of tinkering and making things faster.
Next time I am in Peru I'll let you all know where I can spend BTC.
There are a couple of places now. List is getting bigger daily with some organisation efforts already in motion.
You can always exchange them for local currency: https://localbitcoins.com/instant-bitcoins/
Looks like current pricing is 1217 PEN per bitcoin.
You are right, not everybody know what is BTC and because of this BTC is not that liquid as gold and silver.
But currently the BTC can be used as metrics for 'how paper currencies are not trusted', because while the BTC is not more than bits and bytes as paper currencies (2% is just cash other are just blips), at least behind it is more then few keyboard hits and mouse clicks (several algorithms and massive computing power and energy consumption).
Thanks for replies above, I did not want to come across as sarcastic. I am really curious to see how this BTC is going to work out.
Like this, maybe?
http://www.youtube.com/watch?v=8avOiTUcD4Y
Yup,,,Feds gonna get all over BC like ugly on an Ape!
What are they going to do? Talk it to death like they have with their own worthless bag of shit currency? If they want in, then they can work for the first time in their lives.
There is no 'simple' method to BtC mining incidentally. It's hurry up and wait, or have the better mouse trap built to out perform the next guy. Can't do that with any currency now. not even gold or silver. So unless you feel like staying on earth forever, a carrot is needed to build a future throwing the inexhaustible power of greed at the problem of 'need' instead of 'want'.
It's not unlike today, except you won't have credit unless you've borrowed it at zero interest. It's also situation you mind the dollars and the pennies take care of themselves because it's structured to do that.
knukles, now that's funny!
Yes. I'm not sure what the Winklevoss motivation is but I think a BTC ETF will fall flat on it's face. Bitcoin is cash and carry and even supposing the ETF did make some initial impressions on the BTC/dollar price it would be short lived as the Bitcoin continues to dwarf the dollar in size.
The only way to counter stubborn and stupid in IT is to show the purpose in a clear, rational and structured format that everyone knows what they are getting and the benefits of doing the migration.
Follow that and you can move any organisation to any platform. It's not easy, but sometimes a little elbow grease and courtesy goes a long way to finishing a project. Not necessarily all the time. Sometimes projects get really lucky and all sorts of seredipity happens. Happy accidents. An example. A client from a while back.
They didn't have much money, they needed 50 licenses to replace Office 98 and they needed a method to generate PDF's for their billing system easily. (yes Office 98...I know..what are you going to do though). So sit down with the client on options, they've got three options.
1) Stay and lose their minds at the lack of features they need to do business.
2) MS Office 2010: 50 client licenses is 395 bucks a head for Standard, 600 for the odd Pro license. About 20k. Adobe Acrobat and distiller is around 400 a head not including yearly support costs. Another 20k. Then my bill which is an agreed upon 15 BtC for about a weeks work (that week was around 67 hours of billing time)
3) LibreOffice cost is $0 dollars and it's got built in PDF functions, plugins to edit and they could leverage the voice recognizion in Windows 7 to use as a dictation engine to avoid the messy business of typing. Same price in BtC, but it was only $130 then per BtC.
Anycase long story short. Repackaged LibreOffice in a seperate install shield with all the stuff they needed in the SOW to function as an office suite and deployed it as a Group Policy with a check to make sure it wasn't already installed. (NSIS as an install package creation tool - very nice UI and very flexible open source - free, but I donate to it...in BtC because they've got my back career wise)
My client got a deal and I got paid...AND what I got paid increased in value. The situation moves projects to complete properly because the contractor, myself, needs to be hussling and delivering well. The carrot is on the proper end of the donkey to make the donkey move. It's a business driver.
Thanks, CPL
One of the most interesting comments I have read.
What about the bits .gov stole---at what bitprice can the debt be paid off?
Maybe bitcoin will work as the debt jubilee
Yeah, interesting comment yours---thanks again
Step 1 People/government/business/community groups move first everyone becomes solvent in BtC
Step 2 Move the existing debt into BtC. The pricing of the debt is fractional because BtC moves and operates on the other side of the decimal place. All that debt in turn values the currency people migrated first into 'wealthy' stage.
Step 3 Random stick save from interested parties from all over the world pay off the debt of their governments with a single BtC.
It could happen so fast and open a lot of opportunities. I've mentioned it before, even retail banks could have place in this. They have a lot of capacity technology wise. The security of the currency would only add to existing efforts which could be scaled back to developed better client practices. A bank could literally 'print' money, but only to 21 million coins while combating the technology curve required to meet future needs.
The by product is quantum state computing, force energy production to be more efficient. It's all about timing and placement of the migration that completes a successful software move. And lots of communication of the proposed change. IT has been doing it for years and there are tonnes of good PM's out there that know this process cold.
Everything and everyone is here to do it. All 7.2 billion of us. Can't get to a Star trek future by planning to hide in the woods eating beans. Unless that's the individual's choice to do so.
Thanks, CPL
I thought at one time that.gov would use gold for this purpose, but bits are better.
it is really just simple math, after all, even .gov cannot ignore it----and they get to play for free!
Nice trick---who says there is no intelligent life at .gov----besides me?
They can change my opinion, though
Thanks, again
Everyone is working on it with the time they have. it's just in everyone's interests to get out of the hole. Even the politicians...they aren't economists, we pay them to smile, kiss babies and pass good laws (and some insane ones). They can't focus on that if their wallets are empty, they are always thinking about that empty wallet and the lack of funding options.
Same for every other layer of society. Capitalization of projects moves the milestones with work.
US Government bitcoin holdings from the silk road seizure: 174,000
US Government debt: $17.2T USD
$17,200,000,000,000 / 174,000 = 98,850,574.71
So if 1 BTC = $99M USD, the national debt could be paid off. (No, I don't think that happens, unless USD goes to zero, in which case this could happen on the last day of the USD's existence.)
Another perspective: the entire bitcoin market is smaller than the amount of US debt that is added to the bill in two days.
You are starting to understand how worthless credit and debt is on the otherside of that decimal point. Aztec and Mayans...very smart people using 0 in math. It's only taken us 7000 years to put it to practical use.
What's 6% on .0000000001, not much. LOL!
From a managing prespective, what it will do is give the much needed breathing room people need to get stuff sorted out and it will act as an archive of sorts so old business can be squared away. Right now, Debt to GDP surpasses production. The world is dead in the water.
"A BtC in Venezula or Peru is the same BtC as in NYC or London."
Wait, I thought y'all were against a one-world currency?
I'm confused now...
bitcoin bitchez!
<sarcasm>Oh, that logarithmic chart does not look that bad, so let's keep on buying. Surely this can't be a bubble, but a New Paradigm! </sarcasm>
Regarding that World map application, it misleads, because europeans trade mostly in dollars. For some reason, the 2nd biggest exchange, Bitstamp (European) does only USD.
Tulips anyone...2,000 top
Yeah, Max,
but you know what?
I missed out on the tulips and the fool part of me wants to play in this game----so if I buy a few of these bits---I'll be a part of the most amazing human event of our time.
I don't want to just watch
Then be part of it, I'll teach you how to mine them. Anyone can do it and it's new, so there is no bad question that could possibly be asked. This type of stuff helps build a project case for migration. The sharper and cleaner the documentation is, the quicker a user moves over to it. I'll post something in the forums tommorrow and link it up then answer questions.
What to expect. It will have basic first steps just to tinker with it. Which will show the process on how to setup something basic for no money, because you are just playing around. Should cost exactly nothing to play. Plus it's going to give you a direct example of how looooong the process is to make a single BtC. It's like watching paint dry, but if it's moving, your machine is in the process of making a BitCoin that you can spend.
I'll point out the stuff you want to see happening and the conventions. Basically a Techincal Managers Application Summary with a tutorial component.
That would illustrate the process to everyone and then everyone can run down the tackle dummy with some more shoulder behind them. There's a lot of questions that once you see it in action, it will answer a tonne of the nervous questions on availablility/scarcity/hijacking/counterfeit/etc.
So if everyone is game I'll write it up, there will be some screen shots to it that need to go along with it.
Thanks, CPL
I don't know if I am up to it, but I'll take a look anyway.
I am quite frightened by new things, especially if they are fast----and I'm up to my ass in bears right now, but I am interested----if I can get over my fear of everything human,umhhhhhh
thanks, again
when do we start talking in terms of "satoshi's" ?
we?
@Midas: "Dollar sinks below .002 BTC!"
You should try plotting Gold vs. BTC. OUCH!!!
How many (fucking) times does Kirk have to tell you to (fucking) DIVERSIFY your assets and risk, Bitchez!? Go, ahead, (fucking) junk me, and show me your cretin genes if you can't handle facts or truth. /sarc
BitCoin is more American than the dollar. It's the American dream itself - get rich fast by doing nothing, but trading imaginary assets between speculators.
And it helps you loose weight too, believe it or not! If you had gold in your pocket and traded it for BTC, you would've lost weight right there on the spot!
American dream, I tell ya!
"BitCoin is more American than the dollar. It's the American dream itself - get rich fast by doing nothing, but trading imaginary assets between speculators."
It's like buying PM's with dollars, it's the American dream itself - get rich fast by doing nothing, but trading physical assets between speculators.
I'm so desperate to get some now while I can, I'm using some website that hands tiny fractions of BTC: http://freebitco.in/?r=25727 I don't even know if they actual pay out, but I have to take the chance - it's slightly better than risking money.
Strange for a govt-worshipping paid shill to post something like this.
http://bestbitcoinsites.wordpress.com/ rates a large number of free bitcoin sites. freebitco.in isn't listed.
I smell a rat.
It's Bitcoin-mania!
And if it drops again, you'll exult that the mania broke.
How many times in a row is that now?
Untill the last tile when it won't rise anymore.
Even if it would rise to 999.999$ you wouldn't sell because... it would go to 2000.000$
and it will implode.
The target group is so small. There's so few people buying into it. It's nothing but a joke.
Even if it would rise to 999.999$ you wouldn't sell because... it would go to 2000.000$
I love how you just know what everyone else will do. Must be nice to be omniscient.
The smart people are taking gains all along the way - paying their mortgage with BTC, turning it into AU or AG, and so on.
It makes you feel good to think that all Bitcoin people are blathering idiots, but they're not.
There are some smart people along them for sure.
But not those who bought 200$ and expect it to turn into a million :)
in a few years when all your dreams break, you'll understand.
I think Satoshi would be okay with calling Bitcoin "a joke". That doesn't imply it is not real. That doesn't mean it won't wreck your society and everything you stood for. I am certainly going to be laughing because it's a funnier joke than the one we have now.
Litecoin is even funnier-er.
It's how I get paid now from online contracts now. I'm certainly not taking USD or Canadian or Pounds or any fiat. I work to save so I don't have to work later. Can't do that if the money I have doesn't hold any value and can't buy bread. I know I'm not the only one that notices this situation.
So how do you cut over without people going to war? You put something on the table that is built, as a currency, to be tough as a cockroach with a top limit that can only be reached if everyone has their interests vested in delivering something to one another. Fiat doesn't do that. It's lazy and fat.
BtC, thin, nimble and controlled by the person that needs to control it. The user of the 'software'.
One thing you learn quickly in IT about software policy's are they don't work. Every user is different. Some just need outlook and nothing else. Other's are semi-developers that need X, Y and Z to function. All the way to top tier class developer workstations, where they are typically operating without a net before they test on baseline.
It's a lot of un-necessary work for managers and techs. Same goes for the 'software' called currency. KIS rule. Free trade is real then because anyone anywhere can do their business. The nice thing is, the only person that controls it, again, is the user/business/government. Because it's their wallet.
Negative. We are most certainly not anti-bitcoin. We are simply pointing out that some bitbugs are exhibiting fanatical support for a currency that has just been born and has no history, especially when compared to other more barbarous relics. Plus there is the problem of whether bitcoins actually exist.
"Plus there is the problem of whether bitcoins actually exist."????
Are you really that dumb? Seriously, does this web site exist? Does the tcp packet you used to transfer that message exist? Why would the Bitcoin protocol not exist then and why would people be putting money and man hours into it?
For most ZH readers "real" begins at 380nm and ends at 750nm (simpletons).
Happy you have made some money. Good for you. Cash some out while the price is high.
Buy some gold and some other hard assets.
Precisely the maniacal behavior of which we speak!
you talk in a very agressive way.
So my bet is that you put your last 1000$ into bitcoin and you hope on making a lillion.
you made about 250 to 300$ profit but that's not the reson to get all hyped up. I make 250$ a day doing a normal job.
Bitcoin is a small phenomenon.
It uses software to make transactions.
The valueation is done by 2 users. So in theory, somebody can wait between American en Japan nightttime and push the price with a hundred bucks with one transaction.
Did you notice all transactions mostly came from China and America?
I watched it for 15 minutes and not a single transaction from, europe, england, russia, africa, australia.
that doesn't concern you?
No because that 500 or 1000$ you put into it turned you into a demigod investor who gets to trash everybody he wants to :)
Thank god for the internet I guess because you'd bump your head real hard if you would say that to me in person ;) real hard, by accident.
Bitcoins exist as electronic ledger entries, just like all financial assets today. The question is: who operates the ledger? In Bitcoin's case it's a 100% transparent open-source ledger verified by its hundreds of thousands of users around the world when it is refreshed every 10 minutes. Every transaction ever done is 100% visible to all users. The price of the shiny stuff unfortunately is also just based on electronic ledger entries today. The ledgers that control price are opaque, manipulated, and corrupted: LBMA, GLD, futures, options. Very sad state of affairs. We wouldn't need Bitcoin if this were not true, but it is.
Exactly, it's an idea and idea's need to be vetted, kicked, thrown around, argued about, then packaged, documented, taught...or redeveloped. it's just change, painful confusing change, but there is one industry on the planet that excels at that. IT. Today thanks to offshoring, the lemonaide made from those lemons can be found all over the world. From Afghanistan to Zaire.
As I mentioned, Earth isn't dead in the water. A handful of people operating against their own better interests and other interests are in trouble if they don't refocus quickly. One way or another, it's happening.
Even gold and silver still holds value..because it's gold and silver. When properly stored as an object of transaction value, it goes a long way to planning a future if you know that you can leverage the physical option instead of digital. Still leaves lots of room for security services and the usual, if anything will drive it to improve and refocus of building a better security team...there are just dozens of ways it can go right and dozens of ways it can go wrong.
First step though is discussion of the idea which ZH is awesome for.
A fool I may be? But I'm not touching it. That which is artificial repels myself.
I may die poor but being free of mania is priceless (to me).
So let's get this straight, okay? The cables coming into your house are "real". The data that goes over them is "fake"?
I really don't know how some people get by at all in this world.
Thoughts are real, yet they are quite difficult to store, trade and account.
It's not so much a matter of real vs. fake as it is about a physically tangible representation of human energy that is vitually indestructible vs an electronic blip that can vanish instantly when the power goes out.
The images on my computer screen and television appear (and are) real, but when the plug is pulled, where do they go?
I think we would all agree that it would be difficult to use light or sound as money, despite the fact that they are very real.
The concept of being able to instantly transfer funds or worth electronically is great, but it's still needs a physical world counterpart to provide stability as well as allow it to be used just the same in the real world (exists with or without techology) as well as in cyber world (fully dependant on functioning technology).
I realize we are far from this, but ideally we would have free market real world money (PMs, other ideas?) integrated with technology so as to create the ability to transfer the funds worldwide and be fully redeemable on the other end.
Given a choice to pay a restaurant bill with USD or BTC, which do you choose? If you choose dollars I am thinking: you are lazy, you actually support America's monetary policy, or you do not trust Bitcoin enough to acquire a meal's worth of it. The restaurant owner seems to be making some sort of statement by offering you Bitcoin settlement but you go ahead and throw dollars in his face. Granted Bitcoin is very volatile at this point in time, it should settle down as the price goes up. Any other trust issues can be fleshed out on this message board or through some research.
It's only a mania when al they it's not.
seems like sustainable, organic growth to me!
" seems like sustainable, organic growth to me! "
Sure, until some special BitCoin stuxnet derived worm eats it .
Ah another exercise of imagination in a desperate hope that Bitcoin will die!
All these haters - they SAY that they oppose the Fed, but when the Fed killer arrives, they use all their energy to ruin it.
I for one hope Bitcoin succeeds, though I see a lot of pitfalls, most prominently that it could be made illegal by central bank controlled governments around the world. Won't stop everyone from using it, but most people won't risk it. I don't own any, but I hope it goes parabolic because it would help reset the system. It would reset the system but for inevitable government meddling, which may or may not succeed. Your strategy (selling peaks and buying things you can hold when you take profit) seems rational. I fear a lot of people are buying into the peaks by classic pumpers and intend to hold for the same reason, but only time will tell.
^this. i am too conserative to chance my diminished income on BTC.
i'll stick with a 5000+ yo tradition.
'..but I hope it goes parabolic'...
as you wish:
http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2013...
" Ah another exercise of imagination in a desperate hope that Bitcoin will die! "
No, no, I just trust some government I won't name (know, though, it is somewhere between the Pacific and Atlantic oceans, and Canada and Mexico, ... no, I won't tell you more) , to try something in that direction .
It's really not my intention to insult you...But whatever permits you to have a mind capable of accessing the internet and yet also allows you to arrive at the 'conclusion' of BC as a legitimate replacement for, rather than mere substitute of other forms of fiat befuddles my mind. That which is not tangible cannot become a store of value. As a medium of exchange ANYTHING agreed upon works. I see BC as simply another illusion. A potentially very dangerous one at that.
Admittedly, you may very well understand aspects of BC's properties that I do not?
I appreciate a moderate response.
Look into this stuff. It's probably a lot different than what you think.
"... yet also allows you to arrive at the 'conclusion' of BC as a legitimate replacement for, rather than mere substitute of other forms of fiat befuddles my mind. That which is not tangible cannot become a store of value. "
BitCoin is a fiat currency, whose supply simply can not be inflated ad infinitum by a corrupt government .
The difference with other fiat currencies lies simply in that fact : nobody can inflate it's supply at will, according to one's wishes . That's where it's value lies .
A possible problem for bitcoin could be the emergence of other currencies of the same type .
In the past, intangible "things" could not have been qualified or quantified. What value an idea and how could one monetize it? Technology has come to the point where virtual scarce goods are possible. Bitcoin is one of those. On the other hand, my bitcoins are physically stored on 10s of thousands of harddrives all around the world.
Do you mean that "sustainable, organic growth" of Fiat supply?
Can you stack and hold it?
Yes, you can. Find a notebook and a piece of paper. Write down the unique series of numbers and letters in the public and private keys. Stack those pieces of paper. A more appropriate question might be: can you take a large quantity of gold across borders with you as easiy as you can a small notebook?
You can do the same thing with any digital fiat. Wake us when people are exchanging their bitcoins for physical PMs.
If bitcoin has all the "value" that everyone claims, then it will trully be the hyperinflationary event to end all hyperinflationary events and really get WWIII kicked off in earnest.
hedge accordingly.
Wake us when people are exchanging their bitcoins for physical PMs.
That has been going on for quite some time.
One of my email "virtual friends" says he has done just that:
http://coinabul.com/
It took a while, but he got gold for his BTC.
***
Of course I cannot verify this.
BTC has scarcity. Government fiat does not. The rate of money supply inflation is hardcoded into the BTC algorithm to be about the same rate as the expected increase in the rate of above ground gold supply. Because of the scarcity of both BTC and physical gold, a hyper-inflation of the supply of either is impossible. BTC is your friend, not your enemy.
" BTC has scarcity "
A potential problem for BTC could be the emergence of other currencies of a similar type .
That is far from the problem, that is the whole point. It is called free market competiton. The free market provides for us superior products at a lower cost. There are winners and losers in the free market. The assumption is however, free mraket competition is the most effective way to meet consumer needs with the least resources as input. Free market demand for sound money has given us crypto-currencies because they are superior sound currencies to gold and silver. They are not going away. If you want to use force such as government laws to prevent the adoption of crypto-currencies to protect the status-quo then you might as well go work at the Fed, because that is what they do.
Here is that wake up call you requested. People are selling their gold and silver for Bitcoins locally on localbitcoins.com, Craigslist.com, and over the internet through sites such as Coinabul.com.
Coinabul is a scam. amagimetals.com and goldsilverbitcoin.com are legit.
there are many websites now that exchange phyzz Ag and Au for bitcoins...and I think that's great...if someone can trade 0's and 1's for real phyzz gold and silver then awesome for them.
The thing I'm a little worried about is that people may do the opposite of that by chasing this parabolic rise in bitcoins. I hope people don't dip into their stacks of phyzz and trade gold or silver for bitcoins hoping to one day turn it around and flip it back into phyzz gold and silver again when/if Bitcoin hits some crazy high dollar valuation. There might not be any phyzz available to flip back into unless it's also at a very high bitcoin valuation.
I get this queazy feeling that there is some underlying scam going on (or that eventually there will be one) where "someone" or some entity is manipulating Bitcoin to these high valuations in order to entice people to trade in their criminally manipulated silver and gold phyzz that is being supressed and held at these low dollar price valuations.
Another way to sucker phyzz holders who are getting desperate and impatient with holding phyzz, so they trade it for the next best thing to chase the higher valuations and they will lose their phyzz forever as it ends up being traded East and out of our reach in the West.
I just hope people don't do that. Trade your fiat clown bucks in for Bitcoins and use Bitcoins to obtain phyzz silver and gold. But please don't trade the phyzz you have stacked away for Bitcoins. I just don't trust any of it yet...and I may never trust anything other than phyzz held in my hands and hidden away from confiscation.
I am not pro/con Bitcoin...I do hope it succeeds in a way to bust the central banking cartel, but only if that gets us to some kind of fair type of gold standard that is equitable for all. A monetary utopian fantasy perhaps, but we all want to see the Fed and the evil banksters crushed and hanged for their ciminality, so hopefully Bitcoin is the catalyst to get us there.
Just beware and don't let go of your phyzz folks.
"people are exchanging their bitcoins for physical PMs."
Amagi Metals, Agora Commodoties, Coinabul, there are others.
You know, it was this very idea that first got me interested enough in bitcoin to climb the learning curve: I wanted to mine bitcoins, then use them to add to my PM collection. ("money for nothing!").
But the funny thing is that as I learned more and more about it, reading articles, joining forums, opening accounts on exchanges, trying out software, I started to see its real power more and more clearly.
It is an amazingly powerful, direct and disruptive technology.
So now I have both PMs and bitcoin.
best of both worlds.
Oh, I see, so Bitcoin shares advantages of my HSBC ATM card!
Seriously how come no one realizes the same is true for any scum-coin out there. There is NOTHING special about Bitcoin. I do own very few of them.
That anal-yist is insane. $100K/Bitcoin.
Madness.
Yes it does. But it does not come with the disadvantage of your HSBC ATM card which is it only gives you access to government fiat currency. Government fiat currency has no scarcity. BTC does have scarcity. You get the advantage of scarcity as shared with gold, without the constraint gold has of only being able to be transported physically. BTC can be transfered either electronically or physically. This makes BTC's portability SUPERIOR to that of gold.
Yes. Printable wallets. 3 seconds of research. I keep multiple copies in many locations. If, god forbid, I have to leave in a hurry or a location gets destroyed, there are exact duplicates. I have PMs too, also multiple locations far apart. Same scenario hits, I have to assume those PM assets are lost. That's one of the pros of digital currency. Diversification is another.
Great time to buy into this once-in-a-lifetime opportunity! BTFATH to infinity!
As BitCoin crosses the $508 on its way to its true value of $1,000,000 per BitCoin Max Keiser is likely to be nearing billionaire status. Get it while its hot, only 200,000% left for it to increase.
Jamie should not have bribed Wen's daughter.
Anybody who is willing to give 500 bucks for a bitcoin is a retard :)
I'd only buy it if the price target is 2 million dollar for a digital nothing with a password.
Do you know who makee the most money out of Bitcoin?
THE PEOPLE SELLING THE BITCOIN MINERS!!!!
Did you know that during the goldrush, people making the most money where those who had the bars, sold the mules and the axes.
Indeed. HOWEVER. BitCoin mining is MUCH less accessible to the common man than gold mining was. Which tends to drastically narrow the market for BitCoin mining tools.
Bitcoin might well go to $1,000,000 USD per bitcoin.
What will gold cost on that day?
Bread?
Gas?
The USD is toast, whether you like to stack or buy bitcoin is up to you.
It only needs a miner box running 24/7 in your kitchen, no travel into, no camping in the wilderness required.
Actually the early adopters are making the most out of bitcoin. The mining equipment sales are relatively small (BFL, one of the major suppliers, is estimated to have sold about $25M USD of them.)
A whole slew of smaller miners from the early days (2009-2011) on the other hand, have made millions. Remember we're over a $4B market cap now, and someone with 50K bitcoins has made as much as the largest mining equipment seller. Those 50K bitcoins bought a couple pizzas just a few years ago.
I would consider an early adopter anyone who bought....three months ago. I would even say that early adoption is still here. Ask ten random people on the street if they've heard of Bitcoin. I'd say less than half say yes.
I just don't understand the mindset here. I am not against bitcoin, please don't misunderstand.
However, anyone looking at that chart on the top of the page should really think twice about buying in. So many people are jumping on board with this just because the price is going up. They have no intention of transacting in bitcoin, or saving in bitcoin, or abandoning the dollar through bitcoin.
Common sense alone should dictate that we review our investment decisions, or how we store out wealth. Can bitcoin go up forever? Everyone thought the same thing about home prices, stock prices, equities, the DOW today, etc. I just can't see the safety in a digital currency that has appreciated so quickly so soon.
@ F-Tipp it's the buy on the high , sell on the dips mentality. Seperates many from their monies.
Another hypothesis is that Bitcoin is starting to enter the ascent phase of an S-Curve. This phenomena has been demonstrated by corporations such as Google and Facebook. At one point Google had very few users, a couple months later they had many millions and have kept them.
last weeks "truth about markets" radio show was one of the best hours worth of 'big picture' thinking about bitcoin i have heard.
some number notes- total value of twitter= 5x value in btc. bitcoin already equals 50% the size of western union transactions this year.
it's not a bubble because it has sustained growth build on fundamentals?
To bad 99% of bitcoin addepts won't profit by the price increase and will lose everythhing.
"To bad 99% of ___________ won't profit by the price increase and will lose everythhing."
Fill in the blank with any of the following:
Stock market investors
Bond market investors
Social Security "investors"
Etc
Etc
The only important question: is it government-proof?
My first thought - no.
just some regulation...
:)
so they can just digitally create more to fund their crap and make untill it's 1000 bitcoins for a penny :)
Do some research already, then come back.
It's quite govproof, probably more so than gold and silver.
When the French revolutionaries were issuing assignats, they were cutting off the heads and hands of people who dared to try and use other forms of money.
It didn't work, the currency still collapsed. They can try whatever they like, but people will use BTC because it is simply better than fiat, and due to electronic payments is also more useful than gold. Maybe it won't prove as durable as gold, but for now - it seems to be holding its own.
That one year chart blows me away.
Smoke weed. Fuck bitches. Buy bitcoin.
Live right.
U should print that on some t-shirts !
This so exciting! I've just ultrasounded my bitcoins in order to insure that they are legitimate. Also, when I hold a few of them in my hand, I'm struck by their substantial weight.
Stop being a bitch. If you want them in your hand make a paper wallet.
Who needs to got to the trouble of ultrasounding your bitcoins when you can just go to blockchain.info and view every bitcoin transaction taking place in real time, view every single transaction that has ever taken place and check your own public keys to make sure your balance is still safe in the globally distributed ledger.
And being weightless is a problem? Good luck carrying all of your bars of gold across the globe. I can fly anywhere on the planet with empty pockets and pick up my coins where ever I happen to end up.
If it disappears, if it shows up as a transacton you didn't authorize, what do you do?
And after this objection is answered, there will be another, and another, and another.
Not wasting my time.
Then contact law enforcement to go perform an audit and arrest the thieves. Accounting principles don't change, just the currency. Money that is as private as you like...or it can shine like a lighthouse when it needs to be found because someone complains. Until then it's like a dollar bill, it's fungible and floats to where it's needed. Legitimate or otherwise.
Most law is still 9/10th ownership. There's still going to be lawyers and courts and accountant. We're not jumping in a rocketship and heading to Jupiter. Only the currency would be replaced. A currency that can count down and only as high as 21 million in roughly 100 years.
Transactions are identical with the exception that .000001 is a lot less than the number 1.
I'll try to keep this simple for you. Bitcoin is backed by nothing. It has a historical period that is dwarfed by the lifespan of a parrot. Its utility is utterly dependent on computer networks which are increasingly infected by government interference. Only a tiny fraction of the world's population are aware of, let alone have confidence in it. It has yet to show itself resilient to serious attempts by governments to degrade or destroy its utility.
Gold is understood and accepted by the vast majority of the human population as having significant intrinsic value. It has been widely accepted as money and/or collateral for thousands of years. Everyone from Central Banks to peasants who earn a dollar a day recognize the wisdom of saving it. It has, and continues to show remarkable resiliency in spite of massive, coordinated efforts to undermine its value. It is tangible, and has uses beyond monetary.
We've both made our choices, and I am very comfortable with mine.
Amen and Bingo
"It has been widely accepted as money and/or collateral for thousands of years".
It was widely accepted that the world was flat a thousand years ago.
"Continues to show remarkable resiliency in spite of massive, coordinated efforts to undermine its value".
Easily manipulated, as any daily read on ZH gold forums cry out as much. With it storage and hording in central locations, it is inherently liable to manipulations, deceit, and any wishes favorable its central holder.
The irony of someone promoting a virtual currency that is in its infancy questioning the value of confidence built up in gold over thousands of years is notably deep.
When that irony is compounded, in the same context, by questioning gold's durability and resiliency as a store of value, it becomes incalculable.
In my mind Bitcoin doesn't have much beef with gold. Bitcoin is in direct conflict with fiat currency and central banks. The price of a Bitcoin can be somewhat indicative of how that battle is going. It has to go much much higher to be useful. Gold cannot compete with Bitcoin in this battle: it is too heavy to transport quickly and cheaply like dollars and bitcoins do through the internet.
"The irony of someone promoting a virtual currency that is in its infancy questioning the value of confidence built up in gold over thousands of years is notably deep."
It's like promoting e-mail versus physical "snail mail". Don't worry, I won't expect you to get it.
What a thoughtfully constructed analogy! I'll be sure to follow your comments henceforth, in hopes of learning much more about the intricacies of Bitcoin.
"We've both made our choices, and I am very comfortable with mine."
Not to sound like a broken record, but you can have {gasp} both. I'll be back after making another Au purchase at at 90% (correction 92%) discount...
http://www.youtube.com/watch?v=_4QFErOdTag
Question is; What would you rather have?
A million fiat bucks? Or 700 ounces of physical gold?
Or - the equivalent in BitCoins? A "pig-in-a-poke" if you ask me!
Fiat currency backed by - nothing!
BitCoin - backed by? Well, nothing! Physical gold is GOLD! Freely accepted as payment anywhere!
Gold: totally and utterly manipulated by financial games and 100:1 LBMA leverage among many, many other paper schemes. Uh-huh, that's the one for me.
So you are complaining that gold is on sale?
one btc is equivalent unit wise... the article said 7 ounces per btc. so 7*$1300. one btc ought to cost 7 times the gold price no matter what the gold price. so.... btc is the obvious buy to me
its much more on sale than gold.
Paper gold (and paper silver)...there, fixed it for ya. I get your point, but just as the others stated...are you complaining that the paper manipulation scheme puts phyzz gold (as well as phyzz silver) on sale for us?
Now in my humble opinion just due to the current 60:1 GSR (gold silver ratio) I am personally not buying gold and haven't been since it got above 40:1. I've actually traded some phyzz gold in for phyzz silver via a swap once the GSR got above 55:1.
I have been strictly a phyzz silver buyer over the 40:1 GSR. Just more bang for your Benny Bucks stacking more phyzz ounces of silver at this high ratio.
I hope the "paper" price of silver stays in this range or goes even lower for many more months to come, although I have no clue whether it will or not. Nothing makes sense, so it's impossible to predict what the PTB will "allow" the paper market to do in terms of moving the valuation one way or another. So I just hope they keep slamming that paper down in order to keep giving us little guys time to accumulate more phyzz ounces of Ag.
It's tough dividing my fiat up between Ag, Pb, Pb delivery systems, food and water supplies, etc. I basically rotate as I find good deals in one thing or another while always hoping that if I'm not trading in my Benny Bucks for phyzz silver while I'm buying another supply like ammo then hopefully Ag continues to stay in this low range longer until the next payday so that I can come back and grab another tube of Buffaloes.
The longer they keep this up the better for me and all other stackers out there.
But my main point is that at this crazy GSR of 60:1 I am sticking to phyzz silver until we get back under 40:1 or so and then hopefully I can make some GSR swaps from silver back to gold. I never thought they would keep this GSR so high for so long...gotta be patient though.
<cough> 9000 to 1 in some cases. There hasn't been much mining going on for two years. Silver is even worse now.
Which is more portable across borders or even across town: 700 ounces of phsyical gold or a small notebook with BTC keys written in it?
You fail to finishy your analysis of gold. Gold is backed by something. Gold is backed by an asset. That asset is the the unique atomic coding of protons, electrons and neutrons that gives people who use gold confidence it meets and will always meet four of the five characteristics of sound money: divisible, durable, portable, scarcity. The fifth characteristic of sound money, value in the mind of the actor, comes from that confidence in the atomic coding.
BTC is backed by an asset. That asset is the algorithmic coding of numbers and letters that gives people who use it confidence it meets and will always meet four of the five characteristics of sound money: divisible, durable, portable, scarcity. The fifth characteristic of sound money, value in the mind of the actor, comes from that confidence in the algorithmic coding.
Both gold and BTC are backed by the same asset, a unique coding which gives it scarcity. If you are a proponent of sound money BTC is not your enemy, BTC is your ally.
Gold is backed by real, authentic, and genuine capital. That capital is the sum total effort necessary to extract, smelt, refine, and fabricate it into its final forms. Gold's supply can only increase as a direct function of human labor, effort and endevour. BTC's supplies rise based on computer clock cycles.
Far different.
They're not only different in that respect, but also in terms of the very confidence of which John spoke. Gold has the tremendous benefit of confidence built up and rooted over thousands of years, across every culture and socio-economic boundary. To compare confidence in Bitcoin, which is at an embryonic stage of development, with gold, is absurd on its face.
Furthermore, gold has intrinsic value, in stark contrast to Bitcoins.
who said that bitcoin is trying to replace gold?
Bitcoin is backed by real, authentic, and genuine capital. That capital is the sum total effort necessary to hash 256-bit numbers into final forms that are in the realm of mathematical impossibility to replicate. Bitcoins's supply can only increase as a direct function of human labor, effort and endevour.
What is gold 'backed by'? Considering how you constructed your argument, I thought the conclusion would have been obvious.
Gold is backed by nothing, because it IS money. It is not a reciept, it is not a token, it has no counterparty risk - and it has all the characteristics of money; divisible, portable, fungible, limited supply, durable, acceptable.
BTC has the same characteristics - it IS money. It doesn't need to be backed by anything. The value of money is an intangible, it has nothing to do with gold being physical. Gold simply derives its monetary properties from its physical compostion - BTC draws its monetary properties from its digital nature.
More people need to go back to basic monetary theory and understand why money has value - it has value, because barter is incredibly inefficient, and storing the products of your labor in wheat, or oil or some other bulky, perishable or difficult to store commodity is inefficient and risky.
Money has always been valuable, and its value as money has nothing to do with its other properties - only monetary properties count towards monetary value.
BTC is money, period. It also seems to be a very good form of money - at this stage, only its durability is really in question - as time passes, the question is being answered.
Although I agree with your conclusion I disagree with your premise. Gold is backed by something. Gold is backed by natural law which defines it's unique pattern of electrons, neutrons and electrons, a pattern which cannot be copied or reproduced by any person or persons. BTC is backed by something. BTC is backed by math which defines the relationship of the numbers and letters in a unique pattern for each bitcoin, a pattern which cannot be copied or reproduced by any person or persons.
BTC is backed by natural maths, which defines its cryptographic properties.
Gold, silver, oil (couldn't oil be money?) are all backed by the blood, sweat, tears, energy, and man hours that were put into digging it up out of the ground and processing it to make it into tradeable units, jewelry, or whatever. That's another important part about what makes gold and silver money. Yes, the qualities that make them unique and beneficial to our modern world are very tangible too, which should nearly make them priceless. But even before electronics, etc., or engines, fuels, or synthetics, etc. (oil example), gold and silver were the only true money because they were very rare and it was very hard for men to dig them up out of the ground. Time and energy are money. It takes a lot of time and energy to extract rare materials out of the Earth. People have always understood that...that means the other people who didn't spend all their time and energy doing the digging will want something that took so much effort to obtain thus providing the "miner" or at least the one holding the gold or silver a high value for the gold and silver it took so much effort to obtain.
Since gold and silver are an easily maliable metal it also provides a very accurate way to fractionally divide them into small or large units of trade. Over thousands of years the people on our planet have to come to universal understandings and agreements of certain weights and measures in order to use our rare Earth metals for trade as money.
I wish we could just go back to that. It's going to be very incredible to live (hopefully) through the great reset and the next phase of monetary systems in this world over the next however many years. I hope the good guys win this time...the bad guys have all but destroyed the planet and I think they still pretty much want to at this point.
" BTC has the same characteristics - it IS money. "
Strictly speaking, BTC is a fiat currency, people will use it as a means of exchange only, not as decoration, jewellery, etc .... In other words, it's not a good . The only difference with the dollar (for example), is that no one can increase it's supply potentially ad infinitum (like Ben or Yellen, falling asleep on the print button, can do for the dollars, for example ).
By the way, maybe there is something that can be a problem for bitcoin : it'is the emergence of other currencies of a similar type .
Strictly speaking BTC is not fiat money - in fact you might want to go and look up the definition.
Fiat is currency by decree, that is it is centrally controlled and issued, and is currency not by consent, but by force.
Your point that somebody can print an infinite amount of dollars is in fact the definition of currency, that it is NOT store of value - and is therefore not money.
BTC is neither fiat, nor is it currency - it is money, period.
" Strictly speaking BTC is not fiat money - in fact you might want to go and look up the definition.
Fiat is currency by decree, that is it is centrally controlled and issued, and is currency not by consent, but by force. "
You are right, it's a question of definition . Even though, after verification, yours seems to be the most accepted, I think it's reductive.
To me, fiat currency neither necessarily imply " by decree ", "force", "centrally controlled", nor exclude " consent " .
Personally, I prefer this : " ... fiat money is an intrinsically useless product, used as a means of payment.[19] In some micro-founded models of money, fiat money is created internally in a community .... [20][21] "
"Your point that somebody can print an infinite amount of dollars is in fact the definition of currency, ... "
I have to admit that this definition of currency reflect the reality most of the time, but it's only a definition among others . Here is an other one : "that wich is used as a medium of exchange; money" Webster's ... Dictionary