This page has been archived and commenting is disabled.
BofAML Sees Bitcoin Fair Value At $1300
Bitcoin could become a major means of payment for e-commerce and may emerge as a serious competitor to traditional money-transfer providers, BofAML notes in a report today, adding that as a medium of exchange, Bitcoin has clear potential for growth, in our view. Despite Greenspan's inability to find "value", BofAML prefers not to call the crypto currency a bubble, and assigns a maximum fair-value of $1,300, but does warn that the 100 fold increase in Bitcoin prices this year is at risk of running ahead of its fundamentals.
Via BofAML's David Woo,
How to assess Bitcoin’s fair value?
The value of Bitcoin has risen 100 times over the past year, raising the question of whether it is a bubble. To answer this question, we need to be able to assess its intrinsic value. We don’t offer a forecast for Bitcoin, but below are our preliminary thoughts on how to approach the fair value question. Bitcoin’s is both a medium of exchange as well as a store of value. In our view, it is easier to think about fair value by treating these two purposes separately.
Value as a medium of exchange
As we have argued already, Bitcoin has some attractive attributes as a medium of exchange, especially for e-commerce. What could be the fair value of Bitcoin if it were to become a dominant medium of exchange for e-commerce that accounts for, let’s say, 10% of all the payments for B2C transactions? Let’s do the following exercise:
- US personal consumption expenditures totaled $11trn in 2012
- Household checking deposits and cash totaled $0.7trn in 2012
- Dividing the former by the latter, we get 0.07 (which we will refer to as velocity from now on)
- Velocity has been rising since 2008, likely reflecting cash hoarding behavior that is likely temporary. To smooth it, we take an average of the velocity of the past ten years to arrive at 0.04 -- we assume US households are holding 4 cents in their cash/near cash balances for every $1 spent over the course of the year
- In 2012, total B2C e-commerce sales in the US totaled $224bn
- If we were to assume that the velocity for on-line sales is the same as the velocity for all US household spending, then households would want to setaside $10bn for their on-line shopping
- Given the assumption that Bitcoin will grow to account for the payment of 10% of all on-line shopping, this would suggest that US households would want to have a balance of $1bn worth of Bitcoins
- What about for the whole world? US GDP is about 20% of World GDP. If we were to assume the same degrees of penetration of e-commerce for the rest of the world and that spending by households outside the US has the same velocity, we get to $5bn worth of Bitcoins for the total desired cash/noncash balance of global on-line shopping.
The above is a very rough calculation and we have made a lot of big assumptions. Moreover, B2C is only one dimension of total e-commerce and we cannot rule out that Bitcoin can become a dominant medium of exchange for B2B transactions. Nevertheless, the exercise shows that if Bitcoins remains only as a medium of exchange, there appears to be a clear upside limit for its value.
It has been argued that Bitcoin may become a popular means of payment for illicit trade. We don’t have an informed view on this subject but the fact that all Bitcoin transactions are publicly available (and therefore can be tracked in theory by law enforcement agencies) and that every Bitcoin is defined by its unique transaction history (making it difficult for criminals to cover their tracks6) may limit the growth of its use in the black market/underworld.
In addition to its role as a mean for payment for on-line commerce, Bitcoin can be used for transfer of money (e.g. immigrant worker in the US sending remittances back home). This can be done very cheaply and fast (online settlement in under 10min if the sender is trustworthy like family member or 50min settlement for strangers). How do we assign a maximum fair value to this role of Bitcoin?
Western Union, MoneyGram, and Euronet are the three top players in the money transfer industry (with about 20% of the total market share). Let’s assume that Bitcoin becomes one of the top three players in this industry. What does that mean for Bitcoin valuation? Given Bitcoin’s supply is fixed, when one buys a Bitcoin, one is acquiring not only a medium of exchange but also an investment in the enterprise value of Bitcoin. From this point of view, Bitcoin's market capitalization could be viewed, with a little leap of faith, as its enterprise value. With the average market capitalization of Western Union, MoneyGram and Euronet at about $4.5bn, we will add this number to the maximum market capitalization of Bitcoin’s role as a medium of exchange.
Bottom-line: maximum market capitalization for Bitcoin’s as a medium of exchange = $5bn (for B2C e-commerce) + 4.5bn (means for payments) = $9.5bn
Interestingly, our $9.5bn estimate is below the current actual market capitalization of Bitcoin at $13bn. This suggests that the current market value of Bitcoin assumes either that Bitcoin will account more than 10% of market share for ecommerce, will have more than 10% market share of the money transfer industry (Chart 7)., or will have significant value as a store of value.
Value as a store of value
The value of Bitcoin has been recently outstripping the growth of the nonspeculative transactions using it (Chart 8). This fact alone would suggest that the price appreciation has been more about Bitcoin as a store of value or investment than as a medium of exchange.
How can we assign a value to Bitcoin’s role as a store of value? This is a very difficult question. Given Bitcoin does not pay any interest and that there are no investment instruments (equities or bonds) that are denominated in Bitcoin, the value of its store of value role appears limited. From this point of view, as a store value, its closest cousins are probably precious metals or cash (Table 1), in our view.
Bitcoins and gold have three important common attributes: neither pays any interest, the supply of both is limited, and both are more difficult to trace than most financial assets (except cash). The current outstanding value of gold bar/coins/ETFs is about $1.3trn. Can Bitcoin reach the same market capitalization as gold? We are doubtful.
First of all, Bitcoins are much more volatile than gold, which makes Bitcoins a riskier asset to own. Over the past two years, the volatility of Bitcoin has been on average five times higher than that of gold (Chart 9). All else being equal, this means Bitcoins are five times riskier than gold. Unless Bitcoin volatility declines sharply or gold prices increases sharply, it is reasonable to think that it will be difficult for the market capitalization of Bitcoins to go above $300bn.
Furthermore, the reputation of gold as a unique and safe store of value has been growing for the past ten thousand years. It will take some time for Bitcoins to acquire that reputation. We don’t know how to quantify the value of gold’s reputation, but this reputation is probably the main reason that its value is 60 times that of silver. If we were to assume that Bitcoin were to eventually acquire the reputation of silver (which is an extremely ambitious assumption), this suggests that Bitcoin market capitalization for its role as a store of value could reach $5bn. By the way, $5bn is not too far from the current value of total US silver eagles minted (since 1986), in our view probably the most relevant comparison to Bitcoin, that is around $8bn (12k tons).
Bottom-line: maximum market capitalization for Bitcoin’s as a store of value = $5bn
Bitcoin’s has one advantage over gold in that it is easier to transfer. That said, we don’t think this is a big advantage given the advent of gold ETFs and the ability to move such ETFs in-between accounts. We would not assign any additional value for Bitcoin in this respect.
Clearly, market perception of the Bitcoin’s fair value also depends importantly on the outlook for unconventional monetary policy. If Federal Reserve’s quantitative easing does not end over the next year, as is generally expected, the demand for safe haven assets (like gold and Bitcoins) would increase supporting their value. We expect Fed tapering to begin in Q1 next year and the USD to slowly regain its credibility as the world’s reserve currency, especially as the US continues to reduce its fiscal deficit that will likely fall below 4% of GDP next year. Bitcoin as a store of value likely will struggle to gain traction if our bullish USD view for 2014 turns out to be correct.
Final tally:
When we add our estimated maximum market capitalization for Bitcoins for its role as a medium exchange with that for its role as a store of value, we get a number that is somewhere around $15bn. Although this does not mean that Bitcoin price cannot rise further (as an object of speculation), we think the recent rise of Bitcoin price could soon run ahead of its fundamentals. Our current view implies a:
Maximum market capitalization for Bitcoin = $15bn
Maximum fair value of Bitcoin = 1300 USD
Conclusion
There is much speculation that Bitcoin may help avoid high taxes, capital controls, and confiscation. The correlation between CNY's share of volume of all Bitcoin exchanges and price of Bitcoin is rising. That said, the fact that all Bitcoin transactions are publically available and that every Bitcoin has a unique transaction history that cannot be altered may ultimately limit its use in the black market/underworld.
Bitcoin’s role as a store of value can compromise its viability as a medium of exchange. Its high volatility, a result of speculative activities, is hindering its general acceptance as a means of payments for on-line commerce.
Is Bitcoin a bubble? Assuming Bitcoin becomes (1) a major player in both ecommerce and money transfer and (2) a significant store of value with a reputation close to silver, our fair value analysis implies a maximum market capitalization of Bitcoin of $15bn (1BTC = 1300 USD). This suggests that the 100 fold increase in Bitcoin prices this year is at risk of running ahead of its fundamentals.
»
- 22293 reads
- Printer-friendly version
- Send to friend
- advertisements -
I'LL GIVE YOU 2 EURO'S FOR ONE!!!
I once bought an entire box of pink tulip bulbs from bakker (yes... from belgium) and planted them as a surprise for my mum... as they'd come out and blossom around her birthday.
Yes, but not 1,300 € each.
Are there black Bitcoins?
BULLSHIT....IMPOSSIBLE to set a "fair value"...BTC is real-time fair value.....ONLY the market can set the fair value.....and that is what one is willing to sell and one willing to buy!!!
there is no fundamental analysis involved-IMPOSSIBLE.....it cannot be projected or predicted!
Obviously; but you notice that didn't even slow down the "professionals" at the Bof A; what does that tell you? A managed retirement account at BofA would be a good idea? Probably not.
That sort of means you have to look at that potential future value and make a determination whether it actually has any. If you look at it for capital production you would notice that you can not buy any production machines with it and there are no real markets that have evolved because people are seeking it. That means the pricing mechanism is likely purely financialization, and then obviously worthless to most people. They have to convince people to adopt it through incentives, which is what they seem to be trying to do.
The whole thing is a sham IMO. It's acting like a currency, but a very bad one, which is why it is likely popular these days. People see it as a way to get rich quick by owning it. In the process they are destrpying what wealth they had previously and shortening the life span potential of BTC.
Your avatar is seeming really ironic right about now.
"no real markets that have evolved because people are seeking it"
How about the multimillion dollar online black markets that only transact in bitcoin due to it's beneficial properties? Is this not organic demand?
"They have to convince people to adopt it through incentives"
Well yes, a common reason for any logical individual to do something is because they have an incentive to do so. This is sort of the base idea behind a free market. Perhaps you would prefer adoption through force? I'm not really sure what you are getting at here? But to simplify it incase you are confused, take this example. An online merchant makes a sale to his customer for $100. Does he want to recieve $97 or the full $100? This is just one of the "incentives" bitcoin is presenting that you apparently have a problem with. If you can't see the benefits of eliminating financial middlemen, I can't help you.
WTF!!!! Dickheads
< Vote: Bank of America
< Vote: Bookie of America
To all the BTC pushers, this kind of endorsement should at least have you eyeing the exits.
Endorsement?!? They're trying to convince people that BTC is near the top, so sell now!
The opposite of a lie isn't necessarily the truth, ever think about that?
What if the fair value of BTC is more like $13,000, and they are talking it down?
I wonder if you sell all your gold every time goldman comes out bullish on it?
Why of course. I always trust the nice man at the pawn shop to honestly evaluate my goods, especially when he thinks I have no idea what they are actually worth.
What a bunch of crap! They have no freaking idea how to value bitcoin. They better go back to analyzing stawks...oh wait ...they have no idea how to do that either.
Labor Theory of Value DOE!!
:-P Very much /S
For some reason, I just can't take any of this seriously. it always seems like a joke of some kind. I find it very, very difficult to believe there are sane grown-ups who want to turn in a Gold Maple Leaf for a "bitcoin". It seems like the sort of thing where an over-excited kid is going to stick his head out from the side of the stage scenery, and say "Ha, Ha, just fooling; it was all a joke".
I look at it as a measure of desperation. People desperate to get free of the system they are under. Capital trying desperately to flee.
Hard to say where this is going. Big money needs big liquidity.
In general, bitcoin is not currency. It is a trade. Nothing wrong with that at all. Just a matter of perspective. Everything has a time to buy and a time to sell.
You aren't alone. It's a common reaction when presented with a situation such as this. Go back and look at how many people called the internet a joke that would never be of any true value. If you are interested do the research and you will come to find that bitcoin is about applying the highest levels of mathematics and computer science to solve a problem that mankind has been putting bandaids on for centuries. It's no joke.
I'm setting fair value to Sin (Log(PI))
Oh God, not more math!
.01996? Sounds "fair" to me. ??
A primary dealer putting a fair value on bitcoin? If this isn't a huge red flag, then I don't know what is.
if i was holding bitcoins, i get the fuck out. just a matter of time now before .gov shuts it down in the US. you will have no resource in gettng your "money" back.
All it takes is ONE major maverick nation that says : I'll authorise Bitcoin. Could be those NOT in the USD/EUR/YUAN/£/YEN combine.
Possibly even Russia or India or Brazil could see an interest in tying in into this train; especially if big banks join it.
Bitcoin could become an alternative against the USD hegemony; and there are many contenders out there to encourage such an outcome; as USD currency war is a bitch for many DCs...like S. Africa.
Imagine Bitcoins working out of Singapore and Dubai and Macao or Sao Paolo, all networked if the big boys say Niet not on our territory. We are now all potential candidates to think outside the empire's loop, if it tightens the noose of currency/monetary and financial repression via CBs and PDs.
Fine, but OIL produced in the U.S. will be priced in dollars. when it's priced in bitcoins, then you might have a point.
The problem with that is that BTC is a worse currency than USD. It's a better tool for the Empire than it is for people not within the Empire. It would literally be nothing for some SEC stooge to look the other way as some bank opens an exchange and starts creating positions without holding and set up and easy method to pump and dump it and destroy the muppets.
Unintended consequences, and when the truth is treason then everything is obviously a lie and they will not stop with just basal concealable fraud.
your Bitcoin transactions are totally secret and untraceable and if you choose you banks correctly there is no way for the IRS of any country to know where you park your virtual money gains and how you bring them into your off shore corporate structures (or even onshore ones), if you choose the right financial instruments.
As for taking a holiday abroad with your stash you are your own master.
It would become a problem if the amounts involved were millions but not for middle class living; even in the worst of cases. This a small man's answer to losing his salaried surplus revenues or pensions.
I think that's a very dangerous suggestion. A much better small man's answer as a savings account would be bagged 90%Silver US coins; dimes or quarters.
Opinions are one thing but can we please make some attempt at not spreading bullshit as fact? You can't have "some bank open an exchange and start creating positions without holding." This is an inherent feature of bitcoin that anyone with even the simplest understanding would know. It's a public ledger. All units are accounted for. If you show up and start claiming that you have a million coins for sale, either you prove it on the blockchain, or everyone laughs at you.
But you're not holding any, and I not being in the US, am not getting the fuck out.
But thanks for your concern :)
Buy gold, silver or other products with it online. Get it mailed to you.
Cash out via cheque to a bank outside the US, get it mailed then deposit, some services offer this option.
Trade locally for cash or goods.
Or just don't cash out, some people are using bitcoin to cash out of their domestic currency.
So, who is really behind Bitcoin?
Bitcoin Crashes As China Bans Financial Companies From Bitcoin Transactions
After Peter Schift, The Economist, Forbes and even Mr Bubble himself - Mr Greenspan - have called Bitcoin The Bubble it took the announcement from China to Crash it down from Double Top and parity level with Gold. It is important to note thatChina has been buying the record amount of Gold this year and has encouraged its citizens to accumulate it. Now China is explicitly warning its people about the dangers of Bitcoin speculative Bubble and effectively taking its out of official monetary system. Now position of FED and Congress on Bitcoin is getting more interesting: do we have the Mexican standoff between Gold backed China, FED backed US Dollar and ... NSA, sorry Satoshi Nakamoto backed Bitcoin? Gold should be waking up to the Bitcoin action after this Chinese move and its timing is very important as well: Gold is very close to retest this year low. http://sufiy.blogspot.co.uk/2013/12/bitcoin-crashes-as-china-bans-financ... Can Bitcoin Be The Digital Con Scheme? - Quantitative Analysis of the Full Bitcoin Transaction Graph
The full whitepaper ("Quantitative Analysis of the Full Bitcoin Transaction Graph") is pretty interesting and I don't have time to digest it fully right now. I read it over, and the methods seem appropriate, as far as I can tell as a programmer.
HOWEVER, for sake of argumentative consistency, the first line of "Acknowledgements" section of the paper must be noted:
"This research was supported by the Citi Foundation."
BofA Money Launderers should know.
What does BoA value WoW currency at? How about Diablo 3 gold???
If BTC was trading on the 12 million handle BAC would value it at 13 million. Pikers...
They also see fair market housing prices at 2005 levels...but since its Mark to Magic they already have them there on thier balance sheet...
WOAW !
A TBTF that breaks the banker's code of (dis) honor!
Trying to catch the Heretic gravy train that could bring down KIng Dollar and FED!
Not on! That's not a hail mary pass to your own side but to the enemy!
They must really be desperate to save their thin skins.
Where was BAC when Bitcoin was at $1.30
Setting up loan tables in the rubble of the SF housing market.
Finally... Something marked to market at BofA. Geniuses.
One day, only after the free market has voluntarily adopted what the Gov could not achieve via decree, cyber-currencies will replace regular currencies. Because they will be able to track all transactions for purposes of 'illicit' use or tax avoidance. When that happens, they will buy out BTC and issue whatever rules/regulations they wish.
E.g., there is NOTHING to prevent CBs from backing BTC with their gold holdings, and thus defining BTC on parity with the Gold supply, thus defining their prices on parity (at official/manipulated value). It would become a "defacto SDR", with the CBs holding the gold, and the masses holding the cyber counter-part. Real holdings vs virtual holdings.
What is still too early and uncertain, is what exactly will happen to the present holders of gold and BTC. Anything can happen, and I would not rush out to "project" my own preferences or prejudices toward either. This won't stop irrational/emotional people, as that is SOP for them.
Last I checked you couldn't "buy out" an open-source network protocol. You can of course create your own restricted alternative, but good luck finding adopters. The question being presented is, Why trust the government when you have the option of trusting no one? Now wether or not they'll start imprisoning people for consentually trading bits, well they already do that and I would expect it to continue in the short term.
"The value of Bitcoin has risen 100 times over the past year, raising the question of whether it is a bubble."
or a religion.
what i like about the bitcoin saga is that it reminds me of christianity.
one true god and one true god only. all you have to do is believe.
until you die.
or until you've 'cashed' out.
as is required of all true believers of every true god.
at least that's what i truly believe.
:)
Read this, I posted it earlier in a tongue in cheek mood :
4216862
bitcoin was interesting until the word fell from the lips of everyone from retired central bankers to congressmen to BoA strategists. I have no doubt the FedGov can take total control of the speculative instrument because they can throw infinity dollars at any "problem" until they're in control of the situation. The only situation infinity dollars can't fix is discourteous physics which seems altogether uninterested in their scheming.
bitcoin isn't a currency and it's not used as currency barring a very few virtually irrelevant examples that serve to only prove the rule. It's a speculative instrument where everybody is expecting a bigger idiot to pile in. I'll stay clinging to my shiny. Don't be the last one out of the gate - and everyone thinks they won't be.
BONUS: bitcoin relies on much of the world's population owning a personal computing device. Where's the energy going to come from in the post-petroleum future?
The only situation infinity dollars can't fix is discourteous physics which seems altogether uninterested in their scheming.
Don't want to be around when those pesky Laws assert themselves.
Gave you an up-arrow. But, no one can know the answer to that question. However if we had a free market, I might be surprised what it comes up with. For all I know the free market might come up with Atmospheric Processors like they had in the movie Aliens to clean the air if needed, as one example regarding environmental problems. Have to get the Gov't out of the way first though. I used the word "might". In other words, I just don't know the future. I don't think anyone has a perfect crystal ball. Maybe it will be a Mad Max syndrome. Maybe we'll have Mr. Fusion from, was it the second Back to the Future movie(?) to power stuff with garbage. Or maybe a few tree leaves will power our homes for an entire day or something. Who knows? I/we could speculate all day.
It's a Jetson's World -by Jeffrey Tucker
People used to ask what we were going to do with the exponentially increasing amount of horse shit piling up in urban areas, then the automobile was invented. It takes a very smart person to even have a chance at predicting the future, and even his chances are low.
Bof A is thinking "if you can't beet them join them"
, Fuck you BofA we don't give or care what you think this movments is leaving your kinds out perpesly
On bitcoins, gold and fiat
http://1839assetmanagement.blogspot.com/
Where was Bank of Money Laundering/Feral Lynch when my Beanie-Babies were riding high? Where?!
1. The guy is TRYING to sound intelligent. Saying what the a Fair Value of any commodity is, is simply an educated "guesstimate" for any given moment in time.
2. The fiat price of ALL commodities under the Sun are defined by people, and those values will float accordingly.
3. There have also been (stupid) people who claim that "There is not enough gold in the world to back up the 'money' (currency!) supply".
BS! There will always be enough gold. It's only a matter of price, i.e. dividing the numerical value of fiat currency by the numerical units of gold. It's "$/oz", not "oz/$". People like that are either morons or sophists.
So it is with BTC also: It is not a question on having enough BTC, it's a question of Price/BTC.
"BofAML Sees Bitcoin Fair Value At $1300"
I see the value BofAML's assessment of Bitcoin as negligible.
Is there a Bitcoin 3X ETF yet?
"That said, the fact that all Bitcoin transactions are publically available and that every Bitcoin has a unique transaction history that cannot be altered may ultimately limit its use in the black market/underworld."
And the fact the the Boys from Brussels and the Marrienr Eccles (yes you, Yellen) will find a way to bring it down to $1 and a novelty.
It will be done in the name of safety, security, to stop the terrorists and drug dealers, to save the nation, and for the children.
These are the same reasons they will eliminate cash and PM transactions.
To sophists like Alan Greedscam or simpletons/morons who ask "what is BTC backed by?", I re-post my response (4216388) from last night
BTC is backed by 3 things:
1. Mining costs of Capital + Labor + Energy (PC costs, IT Labor + Watts of Electricity)
2. A basket of fiat currencies from the Fed and other CBs you have circle-jerks with (USD, CAD, CHF, CNY, EUR, GBP, JPY...). Hey, that sounds a lot like the "SDR" from the IMF, except that it comes from the FREE peer-to-peer economy.
3. Goods and Services from the free market economy. There may be some 'manipulation' going on during some "services" of a personal nature, but not from your circle of CBs. "Goods" may include Gold, as there are indeed people who buy/sell back and forth between Gold and BTC.
And what exactly is the Fed's QE ($100B/mo) backed by? How many Watts of PC power is used to pump out all the QE-out-of-thin-air ("15 minutes of time", as I recall). Have the masses actually agreed to committing their Capital, Labor, Energy, Goods or Services to the QE?
p.s. Alan Greenspan, by what and whom are YOU backed by, given that you have not been prosecuted and executed for high treason?
But, but, but, muh shinee metelzzz
Greenspin is a moron, but BTC is not backed by anything (and to his sole credit some 50 years ago he said something smart about gold).
1. Mining cost: so is any other bitcoin spin-off
2. Fiat currencies: that doesn't make sense. If the Fed steps up the QE to $100 bn / month, I should work more for each bitcoin that I don't need because....
3. Goods and services: multiple currencies are claiming to be backed by the same quantity of goods and services.
Fair value of BigCoins™ is $3,000 to $5,000...
What is the shelf life of bitcoin? I say 2 or 3 years until it is completely cracked. How much are 386 computers selling for these days? How much will bitcoins be worth when bitcoin 2.0 is developed by the IMF? Answer = $0
Shit. If the IMF does develop a "bitcoin" that is decentralized and can not be inflated at whim, then I say, we won.
"Its fundamentals". HAHAHA
Re; "Its fundamentals".
The World has gone mad.
God I can't take it anymore. I will never read another post under a bitcooin article again. Its the same lame inacurate erroneous accusations about the demise of bitcoin. I hope the feeling of "right" you guys have now makes up for the left out feeling your going to have.
I see BoAML's fair value at $0. FU, you criminals.
If these asshole banksters see 'value', one is for sure: south and NEVER look back. Bye, bye 'Bitcoin'.
This Bitcoin BS remembers me of the dotcom trash, same hype, same criminal banksters in the background.
This BofA analysis is so much shit that it is impossible to even comment on this. However the same thing happened during the dot com bubble.
The dotcom bubble was fueled directly by excessive credit growth from the Fed. High demand alone, is not what causes bubbles in most cases.
Yes excessiv e credit is one thing. But selling these bitcoin ideas to normal people is totally irresponsible. But hey bancsta is a bancsta...
There is no "demand" that's specific to bitcoin. Any of its spin-off's can be used in exchange as long as both side agree.
Fair value of bitcoin? Next to nothing.
Yes, all the custom created computers doing mass amounts of calculations to secure and operate the transaction system that allows people to freely transfer value to one another over any distance is surely worth "Next to nothing." All the goods and services available for purchase using bitcoins are also of no importance. AltCoins are just as good as bitcoins and will surely invalidate them even though you cant buy anything with altcoins and they have no massive computer network securing and operating them. Just like the monopoly money in my board game box is completely equal in value with a US Dollar that I can use to purchase real goods and services. Do you read this insanity before you post it or do you simply let it flow from your keyboard straight onto the internet?
It's the flow, not the stock. So long as there are more hoarding transactions than redemptions for actual goods going on it'll continue upwards... sound familiar?
A sells to B sells to C sells to A (or any other cycle you care to dream up); see how the bitcoin tape is painted yet? It costs real money (mining expenses) to do that.
would you trade an ounce of gold for a bit coin
would you trade it for paper money
when it's all inflated to zero you still have an oz of gold no matter what it's now worth. with the paper money you could still wipe your ass with it. with the bit coin you have code worth nothing even if the web is still up and running.
I have been hearing this alot lately; the whole "When the web goes down..." and I'm just not buying it. IF, and I do mean IF, the web were ever to "go down," then I'm afraid that paper wallets and well-hidden oz- maples, become equally usless. I have: Bitcoins, maples, silver and a whole heap of "transferrable" brass and lead; but the fact is that if things ever did get that bad, none of it will matter.
They won't provide you with drinking water, or protection from the APC-driving goons about to rob/murder you, or give you medical attention or protect you from the nuclear or biological contamination that would most certainly be in the air you were breathing.
tbc..
Unbelievable how people beleieve this can work. It is not a legal tender. Companies need to pay taxes and so exit, so if any bigger one joined first they would want to take major markets share and so take other companies profit margins as hostage. And how would tax agency know how many wallets you have? yes I have only these two. How could anyone know? the anonymity part is the most threatening part. I dont get this hype
well it's only at 1000 bennybux today.
I GUESS I BETTER GO ALL IN!!!!
Anonymity is a threat to them not us. Even if the .gov outlaws the use of bitcoin how would they enforce it?
TCP reset packets to shutdown the network.
Chinese banks are declaring the crypto currency a fraud and the American banks are pumping the shit out of it. Listen kids, its not like anyone can just make up their own fucking currency. Ok!? It's not that easy.. although it really is. Swear to god, they're not printing money from thin air either. A banker assured me just that in a very recent discussion. I feel very comfortable with our banks NOT printing money from thin air and the side show that is NOT bitcoin.
Ever notice how bitcoin started making headlines when the US was denied going to war against Iran, I mean against the Syrian dictator? Could be coincidence or could be a diversion. Same with all that noise around NSA and spying on each and every US citizen, their emails and their phone calls and spying on the whole world beyond.
Let's talk about the real issues the bankers are trying to avoid talking about. Namely that their ponzi is at an end and that we're at peak oil and peak growth. They have no clue what is coming next and that is the best part of it. Their paper fortunes could be annihilated in the blink of an eye depending on where the wind blows from.
Interesting contrast: DOA, i mean BOA, lending credibility to Bitcoin and China attacking it. Makes me think Bitcoin is indeed a stalking horse for the banksters. Gold or Bitcoin vs the USD. On the one side China loading up with gold on the other Banksters pushing Bitcoin. Why? Because they are getting close to loosing the gold price rigging game.
Well, in all fairness to the goldbugs....
When bitcoin was $12 back in Jan, nobody gave a shit. Now that it has hit $1200, some people have some things to say. Just like with gold at $1200 an oz, nobody really gives a shit. But if gold were to jump to $120,000 in less than a year, everybody and their grandmother would be saying gold is in a bubble.
Any parabolic rise like BTC is suspect. I applaud those who made money, but I foresee a much more sinister application to all of this.
Mark of the beast
Bitcoin
B=2 i =9 etc...
2920 315914
2+9+2+0+ 3+1+5+9+1+4
=36
3 6's
666
;)
http://social.razoo.com/wp-content/uploads/2012/08/hand.jpg
Anyone with hexakosioihexekontahexaphobia should avoid bitcoin.
i have truck loads of post holes for sale. great for burying your bit coins
A limited amount of nothing.... it does have a Zen quality about it.
What is the sound of 1 bitcoin clinking.
Nice. One of the biggest bankster hogs vicariously backs bitcoin. Need I say more?
Thios is such bullshit. A virtual currency worth as much or more than an ounce of gold? This is so fucked up.
If I have to choose between 1 of nothing, or 1 of something for the same price, I would pretty much pick something every time ha ha.
Welp, in my calculation, I pummeled one banana with 2 pomegranates, which by the way remind me of tits for some reason. I then carved an avocado and squished it with my bare hands. I was watching cartoon while calculating. The fair value of a bitcoin, my $1 calculator states, is 'E'
To infinity.............and beyond.
Thats funny, thats what I had it pegged at for weeks.
It's not money: http://www.lewrockwell.com/2013/12/gary-north/are-bitcoins-money-2/
I guarantee woo takes it in the a$$
PS No KY
Is this an Onion piece?
The price of 1 bitcoin is approaching the price of 1 oz of Gold. Apparently vast amounts of expensive computing power is needed to "mine" a new bitcoin into existence. Bitcoins are designed to be a limited supply of nothing. as opposed to say US dollars which are a unlimited supply of nothing. I can think of something else that takes vast amounts of money to mine, and is in limited supply, yet is something Gold!
When it gets to $1300.00, does it stay there and take a rest for a while?
why would i accept as payment something who's value could change daily.......BY A LOT???
Because there are payment processors offering fees 3x lower than the competition who will peg your price to whatever currency you want. Also it's been going up a lot more than it's been going down.
In a few years you will all laugh at those that questioned bitcoin.
All other currencies willbe obsolete.
No other crypto currency will exist, only bitcoin, and at 100,000+ each.
Two kinds of people left on the planet, bitcoin moguls, and their slaves.
All you skeptics, check this out: http://www.tfmetalsreport.com/blog/5297/bitcoin-black-swan
Here is how the whole game will change...by making Bitcoin very real, which will lead to a grand
new world reserve currency... and eliminate ALL potential regulation problems with bitcoin being
equated to currency!!!!!
The real relationship between Gold/Silver and Bitcoins needs to be a marriage!
The way to move the whole thing forward is to open an exchange, like mtgox, but only gold and
silver weights, not US$, to be exchanged/traded for btc. You need to use small shops everywhere, like a current cash shop,
or pawn broker that fronts all of the small trading for everyone. So you give them some gold or silver and they give you btc or
you give them btc and they give you gold silver based on current gold/btc exchange rates.. all 3 things cant be touched by
megalomaniacs and are outside of "world money regulation/phantom creation" This also solves the problem of not much liquidity for
the easy transfer and payment using actual pieces of gold and silver over the internet ..... now their value is
transferable to btc, which is easily exchanged anywhere for everything starting with the most important thing wages for
employment.
BTC is the same as gold in some ways , it has a finite amount available over time, cannot be
"printed" into oblivion, must be mined and is a store of wealth and no one individual or group owns the system, it
belongs to everyone. To marry the two is perfection, you give liquidity to gold/silver /other commodities via btc so they can
be transferred instantly anywhere for goods and services and you eliminate the governments and richest families from
regulating it because oif its current links to currency which they have always completely controlled for their benefits.
The numbers make sense..if you look at fractional bitcoin system the numbers more then make
sense... each btc can be broken down to units that equal .00000001 so There are really 2,099,999,997,690,000 (just over
2 quadrillion) maximum possible units in the total maximum bitcoin design. The value of "1 BTC" represents 100,000,000
of these. there is only around an actual 1 trillion in printed usd $ around and currently 60+ trillion in total debt
http://www.usdebtclock.org/ (not including unfunded liabilities ) So there is, or will be by the year 2140 (end of bitcoin
mining), 2000 times more exchangeable bitcoin units then us$ in the world and then there are no more.
More gold mined down the road will just change exchange value..
but both gold and bitcoins have physical limits of the total in existance.