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Aussie Bank Asks "Will Bitcoin Replace The Dollar?"

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Bitcoin is rapidly becoming part of the everyday lexicon. Following David Woo's investigation, National Australia Bank's Emma Lawson looks at its creation, use, and quality as "currency," and find that Bitcoin meets most, but not all the conditions required to be a currency. Lawson concludes Bitcoin may not be the most efficient monetary system, given the costs to create, and that the supply set-up can be seen as both an advantage (hyperinflation is not possible) but also a disadvantage (there are conditions which may create deflation). But, if enough people believe in it, and use it, it may be here to stay as a payment system. Simply put, its success (or failure) will depend on establishing trust and adoption.

Via National Australia Bank's Emma Lawson,

The Rise In Crypto-Currency

What are Bitcoin?

Definition of a currency:

Noun: a system of money in general use in a particular country: the fact or quality of being generally accepted or in use.

“Bitcoin” has entered the popular lexicon, challenging our idea of what makes a currency, currency. The definition of currency above does not mention the physical characteristics of the same but that it must be generally accepted.

There have been different forms of currency over the centuries, but what is important is that users believe it to be currency. Banknotes themselves were introduced in China in 118BC as a promissory note. Marco Polo, in the 13th Century recorded that paper bark was used in the place of gold or silver. The first colony in New South Wales used rum for currency, in the absence of printing presses. These examples show that currency or money can be different things, they are not static and they do not have to be physically valuable in themselves (like gold).

As such, Bitcoins can indeed be currency, as could anything labelled as such. As long as you believe it is.

Firstly, what are crypto-currencies? Bitcoin is one of around 50 crypto-currencies, albeit the most well-known, traded and first established in 2009. These are de-centralised digital (or electronic) medium of exchange. They are not backed by physical assets but rather peer security.

Primary issuance of Bitcoin is determined by computer algorithms which require large amounts of computer power, to validate sequences (blocks) and proof-of-work. As more “miners” participate in calculating blocks, the required computer power and sequence of blocks increase; thus not allowing an increase in the speed of Bitcoin issuance despite more mining. Participants become Bitcoin miners to claim transaction fees and initial Bitcoin.

Indeed one claimed benefit of Bitcoin is that in a world of quantitative easing, this alternative is designed not to increase above the scheduled path. Bitcoin are created at a “decreasing and predictable rate…issuance halts completely with a total of 21 million Bitcoins in existence."

The secondary market for Bitcoin is where most participants will acquire them for their digital “wallets” i.e. accounts. The price is determined on exchange via demand and supply, similar to the broader FX market.

At present there are eight dominant exchanges but there have been more and the number changes (Chart 1). In a study of 40 Bitcoin exchanges, 18 were found to have closed and taken customer accounts. Popular exchanges were also found more likely to experience security breaches2.Prices may also vary between exchanges. The most popular in the USD market is Mt Gox, which constitutes 52% of USD volume (based on the latest month average volume); closely followed by Bitstamp at 46%.

Trading of Bitcoin is most popular in CNY, at 46% of the total Bitcoin market by currency, closely followed by USD at 45%, EUR takes up a small percentage at 4%. This makes the China Bitcoin exchange the largest available; it makes up 47% of total Bitcoin trading (Chart 1).
 

The price on a singular exchange has been particularly volatile recently (Chart 2). There have been calls of a bubble in the Bitcoin price. The price tracked an average of $5.44 in 2011 and $8.29 in 2012 but has risen exponentially from October 2013. It peaked at $1200, and has dropped back to $575 more recently, after regulatory changes in China.

The fact that there are multiple exchanges but only 1723 registered businesses worldwide advertised as using Bitcoin (no doubt there are more in reality), suggests there may be something in the idea that there is currently more people buying Bitcoin in anticipation of an increase in Bitcoin value, rather than buying Bitcoin in order to use them as a payment method. That strongly suggests a bubble in the present value of Bitcoin.

Be that as it may, it does not discount the idea of Bitcoin as a currency or payment system, albeit a presently volatile one.

Bitcoin as a desirable currency

There are a number of qualities that a currency must have to be effective and sustainable. The NSW colony’s use of rum fit the bill by being recognisable but it arguably wasn’t durable when holders got thirsty! Bitcoin has certainly captured the attention of markets and the media, but if it is to have longevity, these tried and tested qualities must be in existence. These are necessary but not sufficient conditions to qualify as currency.

Durability: the unique feature of Bitcoin is that they are electronic, and not physical money. The concept of electronic funds has grown, and examples of electronic units of exchange have been around for some time in the shape of, arguably, credit cards, but also PayPal. Stories of throwing the hard-drive at the local tip aside, crypto-currencies are durable in their electronic records. Computer back-ups are recommended.

Portability: similar to durability, with an electronic version of currency, the portability of Bitcoin is less of an issue. As long as you have a smart-phone. Clearly there are some issues here, with access to smart phones or portable technology not universal. There may be restrictions on use by age or location for example. Anyone trying to just make a mobile phone call in a remote area in Australia could perhaps attest to that.
Fungibility: or the ability to exchange Bitcoins for other Bitcoin without cost. For example, swapping a $10 note for two $5’s. Bitcoin are fungible, although as they come in only one denomination it is less of a concern.

Divisibility: the ability to split a whole Bitcoin. This is possible. It is this ability to split into fraction of Bitcoin that the proponents of the crypto-currency believe will solve the problem of there being a finite amount ever minted. They believe that when there is expanded use and demand for Bitcoin, combined with a limited supply (at 21 million), that Bitcoin will become increasingly divided or fractionalised.

The clear flaw of that plan is the concern regarding deflation. If one Bitcoin can provide the owner with increasingly more goods or services over time (ie. demand outstrips supply for Bitcoin, not goods and services), that means the price of goods and services are falling. This tends to dampen consumption. This may occur only when the final Bitcoin is minted and if demand for Bitcoin use continues to rise.

Scarcity: Bitcoins are scarce as they require expensive and time-consuming computing resources to create. Hacking or counterfeiting is claimed to be prevented by peer pressure or game theory to prevent an invalid increase in minting. This has not been entirely successful, with breaches in June and August 2011 and April 2013. The security features are being adapted over time to address problems as the system matures.

The scarcity can also be considered a flaw. The supply of Bitcoin is inelastic. There are periods of time at which an increase in the money supply is warranted, to meet demand and then cyclically reduced. Bitcoin does not allow for that. The current spike in Bitcoin is an example. Demand for it has risen (arguably on speculative grounds), and supply cannot match it; hence the rise from $100 to $1200 over four months.

One factor is that there are a number of alternative crypt-currencies. Bitcoin is the dominant system now but that is not to say that it will remain that way. Crypto-currencies may stay around and thrive as a payment system but not Bitcoin.

Recognisability: there is a growing awareness of Bitcoin as a payment system. But, its use is limited. Some might suggest that its recognisability at present is concentrated on its own price, rather than a medium of exhcange.

The Bitcoin website shows 1723 sites worldwide that advertise their use. In Australia, there is a café in Adelaide, a website services firm in Melbourne, a juice bar in Sydney and a currency exchange on the Gold Coast. There are likely to be more than that and it is growing. But it is not yet universal.

Mention Bitcoin at present and many would discuss its use as a store of value before its use as a medium of exchange. And this takes us to the other properties of being a currency.

Trust and Adoption are Critical

“Bitcoins have value because they are useful as a form of money”

In a discussion about Bitcoin with a computer engineer I asked “how is it created?” and had the spiel about computing power, energy and the resources needed to identify prime numbers. Ok, that’s great, I may never understand the maths but I get that it requires substantial resources to compute. The next question “so what does it produce that is valuable?” answer – nothing.

Bitcoin are valuable because they exist, because people believe that it may be so. It’s a self-fulfilling prophecy. There must be trust in the system, for Bitcoin to retain any value. This is how it differs from other payment methods like credit cards and PayPal, which have a pool of funds backing them. Crypto-currencies may be cheaper as a payment method because they do not have that asset backing, but it thus relies more on trust than alternatives.

Bitcoin comes about as a response to quantitative easing and concern regarding central banks’ printing money. But what it cannot replicate is the revenue generating abilities of central banks and the governments that control them, or their inflation fighting credentials. Neither does it have the centuries of history that gold is backed by.

Bitcoin will work as a medium of exchange as long as participants believe in the security of the triple-counting system and peer-to-peer security. But this takes time. Given this, we shall likely not know for a prolonged period of time how successful the crypto-currency experiment will be.
The other condition that Bitcoin needs to be successful is adoption. It needs to become broadly used and accepted. Its (short) history so far has mostly encapsulated illegal activity characterised by the deep-web site Silkroad; subsequently shut-down. As already noted, there are only four businesses in Australia registered on the Bitcoin User site showing they accept it as a medium of exchange.

The connection between Bitcoin and illegal activity will have to be broken before it becomes widely trusted and accepted. Again, this takes a long time to establish. So while we cannot say that Bitcoin will definitely not become a medium of exchange, what we can say is that it will take a prolonged period of time to prove.

The Regulatory Environment

The increased focus on Bitcoin has led to a wealth of commentary and legal stance on its use from central banks and regulators. A few are outlined below, no country has wholeheartedly adopted its use:

Australia – RBA’s Stevens: “maybe there will be a world in which currencies based on some computer algorithm to limit supply as opposed to physical gold or something. There have been many such currencies through the ages…the ones that will survive will be the ones that hold their value which is why we have an inflation target which we’re hitting.”.

China’s PBoC have banned the use of Bitcoin by commercial banks and the clearing of payments in Bitcoin by third-party providers. China has been the most vocal and proactive in preventing the use of Bitcoin as an alternative to local currency in the major nations using (or investing in) Bitcoin. With the Chinese market for Bitcoin the largest so far, this may be a natural response to protect the central bank’s authority on the money system. Needless to say, the price of Bitcoin in CNY fell sharply on the latest announcement (18 December 2013).

The Swiss have taken a slightly different tack, by preparing to declare Bitcoin as a foreign currency. This ensures that it is not a domestic alternative but that it can be tracked and must be declared so as to meet tax and money-laundering laws, but not banning it altogether.

Germany has acknowledged its existence by declaring it a “unit of account” for tax purposes. It is not a foreign currency but “private money.” It now attracts a 25% capital gains tax.

The EU banking regulator has warned on the use of Bitcoin, in regards to theft, price fluctuations and the lack of central bank backing or security on the same. This has been followed by the French Central Bank which said its use is highly speculative and poses a financial risk to users. Dutch Central Bank President Wellink noted that Bitcoin hype was akin to the 17th century tulip bubble (but didn’t result in a flower at the end of it). The Dutch central bank has warned against their use as they are not regulated and there was no underlying liability. There is no deposit guarantee scheme.

Most jurisdictions treat Bitcoin as assets and require tax to be paid on capital gains. The Norwegian government said that Bitcoin were not considered money or currency and will tax it as an asset, similar to Germany, at 25%,

Thailand was the first country to ban its use as it was ruled not to be a currency.

In November, the US held a Senate hearing on the use of crypto-currencies. Much of the discussion was positive and upheld their use as “legal means of exchange’” There are ongoing concerns about its use in illegal activity.

In a world that is used to being bailed out when the financial system fails, Bitcoin’s decentralised system is a benefit to those in favour of limited government control, but is a distinct disadvantage to those who are used to the final bill being picked up by governments. If the present leap in Bitcoin price proves to be a bubble, it will be the individuals picking up the tab, not governments. There is no deposit scheme or any “too big to fail.” While investment in Bitcoin is small, that poses individual risk. If Bitcoin use becomes much broader, that becomes a risk to financial stability. Caveat emptor.

Bitcoin to replace the AUD? Not Now

We have established that Bitcoin meet most, but not all the conditions required to be a currency. The rest may follow, but that it will take a very long time to be proven. Its success (or failure) will depend on establishing trust and adoption.

Bitcoin may not be the most efficient monetary system, given the costs to create, and that the supply set-up can be seen as both an advantage (hyperinflation is not possible) but also a disadvantage (there are conditions which may create deflation). But, if enough people believe in it, and use it, it may be here to stay as a payment system.

However, there is a large red flag saying buyer beware at current levels of price and use. With no macroeconomic backing, it is impossible to determine fair value for Bitcoin aside from demand and supply – but the chart of AUD/BTC (Chart 3) above shows, BTC’s trajectory is not one of a stable currency.
 

 


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Fri, 12/27/2013 - 21:03 | Link to Comment Bindar Dundat
Bindar Dundat's picture

http://www.cryptocoinsnews.com/2013/12/27/2014-bitcoin-war-started-bobby...  The war is starting in 2014 and we will see where Bitcoin is next year.

Fri, 12/27/2013 - 21:40 | Link to Comment Jumbotron
Jumbotron's picture

In a word.....no.

Bitcoin is not tied to labor.....it is hackable......it is transported over an entirely captured internet.

Once this truly threatens the dollar it will be shut down or taxed out of existence.

Fri, 12/27/2013 - 21:56 | Link to Comment zaphod
zaphod's picture

It can't be shutdown without effectively turning off the internet. It is also, so far, proven to be completely unhackable, the only examples of people losing their bitcoins are those who did not manage their keys well or trusted them to 3rd party websites. If I trust my PMs to 3rd party websites and my PMs disappear I wouldn't say that PMs are hackable or insecure, I'd say that I was an idiot for trusting website xxx.

Fully agree they can tax it into oblivion. If bitcoin becomes successful, and there are a ton of "Bitcoin billionaires", you can be sure the public will be OK with the government taxing those who speculated and won.

 

Fri, 12/27/2013 - 22:25 | Link to Comment CH1
CH1's picture

Wait... I thought Bitcoin was dead.

Haven't there been 5 or 6 deaths now?

Fri, 12/27/2013 - 22:59 | Link to Comment fonestar
fonestar's picture

SATOSHI HAS RISEN!!!

Fri, 12/27/2013 - 23:03 | Link to Comment nmewn
nmewn's picture

Damn...another porn thread.

Fri, 12/27/2013 - 23:38 | Link to Comment Prisoners_dilemna
Prisoners_dilemna's picture

"Divisibility: It is this ability to split into fraction of Bitcoin that the proponents of the crypto-currency believe will solve the problem of there being a finite amount ever minted.
The clear flaw of that plan is the concern.... This tends to dampen consumption."

Should we shit in our own playpen?
Are we going to get off shaceship earth or do we need to let the market help us find solutions for the long haul?
A life well lived doesn't revolve around consumption does it?

I saw "porn" and divisibility/reproduction entered my mind?!

Sat, 12/28/2013 - 00:10 | Link to Comment nmewn
nmewn's picture

One runs into the strangest people on these threads ;-)

"Should we shit in our own playpen?"

Like creating "money" from thin air without ever questioning the true motives of those from whence it came?

"Are we going to get off shaceship earth or do we need to let the market help us find solutions for the long haul?"

Getting off this rock is inevitable, we are not immortal. The market is not my body or soul.

"A life well lived doesn't revolve around consumption does it?"

Consumption of what? No one can live without consuming, something.

"I saw "porn" and divisibility/reproduction entered my mind?!"

The idea of alchemy has been around for centuries, so far, a complete waste of time & resources.

Sat, 12/28/2013 - 00:38 | Link to Comment Scarlett
Scarlett's picture

I am angry, and bitcoin pisses the control freaks off.  Henceforth, I'm buying.

Sat, 12/28/2013 - 05:28 | Link to Comment TeMpTeK
TeMpTeK's picture

Bernard Von Nauthaus pissed em off too...

Sat, 12/28/2013 - 11:05 | Link to Comment XitSam
XitSam's picture

NotHaus.

"It is a violation of federal law for individuals, such as von NotHaus ... to create private coin or currency systems to compete with the official coinage and currency of the United States."

“Attempts to undermine the legitimate currency of this country are simply a unique form of domestic terrorism,” U.S. Attorney Tompkins said in announcing the verdict. “While these forms of anti-government activities do not involve violence, they are every bit as insidious and represent a clear and present danger to the economic stability of this country,” she added. “We are determined to meet these threats through infiltration, disruption, and dismantling of organizations which seek to challenge the legitimacy of our democratic form of government.”

Take aways: The government does not acknowledge that Nothaus' currency was actually money (bullion). And if you provide an alternate currency, you are a terrorist.

Sat, 12/28/2013 - 00:40 | Link to Comment Yen Cross
Yen Cross's picture

 Just take some time and listen. We're not faulting your encription, or devotion.  

   Please, just sell a small portion of your holdings, and buy back in at better levels.

Sat, 12/28/2013 - 07:27 | Link to Comment goldflows
goldflows's picture

Noooo you have to buy the dip!

/sarc

Let em lose their shirts

Sat, 12/28/2013 - 00:03 | Link to Comment Jumbotron
Jumbotron's picture

Uhhh....ask Megaupload how that's working out for him.

Sat, 12/28/2013 - 00:11 | Link to Comment TheHound73
TheHound73's picture

They were centralized just like e-gold and liberty reserve.

Sat, 12/28/2013 - 02:41 | Link to Comment Al Gorerhythm
Al Gorerhythm's picture

I assume that the writer and bitcoin/currency supporters have been schooled using the same maths curriculum used world wide. That being the case, it was therefore the same one used to school the rest of us non-currency heretics. We were all versed in the magic of compounding interest with the wild claim that if we saved our currency, we would all, one day, be rich!!. We were schooled to believe in currencies growing in number by magic. We could all get richer if we only believed.

We did not inherit this belief system of money through gift of genetics. It was implanted, as gathered knowledge and passed on from parent to child, both at home and school (in loco parentis). We were schooled into believing that this paradigm had justification through algabraic certainty.

The author claims that to justify currency as being money, it just simply has to be believed in. That is all!

Just believing in something for the sake of believing, doesn't create its bone fides. Belief systems based on faith don't prove validity of argument. You are simply a believer. 

The fulfillment of the properties of money by comparison, requires a complete level of authentic and verifable claims to back its promise, standards such as weights and measures used to denude it of deception and fraud.

Currency true believers, simply haven't discovered the massive store of research and philosophy that describes the differences between currency and money, that knowledge of which is necessary to change their belief system. They can't see the harm in the deception of fiat currency with its innate time-decay value destruction, the saved tokens of labour losing value through inflation of supply with the destruction of the value of a man's labour being the utltimate deception. 

Currency is similar to an option. You have the right to buy or sell something but not the obligation to settle.

Fri, 12/27/2013 - 21:07 | Link to Comment malikai
malikai's picture

Queue incessant ignorant arguments against bitcoin.

Fri, 12/27/2013 - 21:17 | Link to Comment SWRichmond
SWRichmond's picture

Cue shameless bitcoin pumping by fonestar.

Fri, 12/27/2013 - 22:49 | Link to Comment fonestar
fonestar's picture

Bitcoin is invincible, deal with it.

Fri, 12/27/2013 - 23:04 | Link to Comment akak
akak's picture

Bitcoin's value is invisible, deal with it.

Sat, 12/28/2013 - 03:18 | Link to Comment TheHound73
TheHound73's picture

Oh, how cute. You just realized Bitcoins are intangible?  Pretty late to the party but better late than never.

Sat, 12/28/2013 - 07:35 | Link to Comment caShOnlY
caShOnlY's picture

the governments would love a digital currency. They have it now, don't they?  Create all the digial currency they need while collecting the taxes on all former cash businesses (restaurants, bars, tips, etc....). 

They also can track every puchase made.  No black market, no drug sales, no more smuggling - just complete control.  

You are so very right, it is invincible.  Buy some.

Sat, 12/28/2013 - 19:53 | Link to Comment fonestar
fonestar's picture

The gov cannot track Bitcoin users and they do not want a digital currency they cannot control, your arguments are stupid.

Sun, 12/29/2013 - 14:34 | Link to Comment akak
akak's picture

If it is done online, it can be Iand most likely already is being) tracked.

Fonestar, for you to suggest otherwise proves you to be either a woefully naive idiot or else a shill for the Establishment power structure.  Possibly both.

Sat, 12/28/2013 - 03:28 | Link to Comment Al Gorerhythm
Al Gorerhythm's picture

Which end of the cue?

Fri, 12/27/2013 - 21:27 | Link to Comment 1835jackson
1835jackson's picture

It's more about humans than the "soundness" of  bitcoin. Bankers do not like it, ergo bitcoin is fucked. 

Fri, 12/27/2013 - 22:35 | Link to Comment CH1
CH1's picture

Bankers do not like it, ergo bitcoin is fucked.

The cartel is NOT God.

Fri, 12/27/2013 - 22:57 | Link to Comment Harbanger
Harbanger's picture

Can you use Bitcoins to get money out of a Capital-controlled country like Argentina?  No.  I have a friend how sold a property there and is trying to get his money out of the country.  If the banks don't play, you're not moving money anywhere.

Fri, 12/27/2013 - 23:03 | Link to Comment fonestar
fonestar's picture

Of course you can use Bitcoins to get money out of Argentina or anywhere else.  By "you" I am of course talking about your average sixteen year old internet user and not the "metals only" Zerohedge commentator.

Fri, 12/27/2013 - 23:08 | Link to Comment Harbanger
Harbanger's picture

How do you do that when they limit and control your withdrawls and transfers?  He doesn't want to buy 1 bitcoin a month for 30 years.  Yes when you sell a house they write you a check.

Fri, 12/27/2013 - 23:12 | Link to Comment fonestar
fonestar's picture

Well I guess that's a problem in his particular case if he is trying to make on large transfer from his account to another account selling Bitcoin.  Hopefully people learn from their mistakes and never use a bank again.

Fri, 12/27/2013 - 23:21 | Link to Comment Harbanger
Harbanger's picture

If I write you a $500,000 Check who's going to cash it for you?  Your thinking very small potatoes, that's not how the World works.  Capital controls would freeze Bitcoin use except for completely illicit trade.

Fri, 12/27/2013 - 23:49 | Link to Comment Prisoners_dilemna
Prisoners_dilemna's picture

We can go here and see the largest 100 transactions out of the last 50,000.

This is real time and 50,000 transactions occur every 24 hours at todays usage rates.

So for those too lazy to learn about bitcoin...  the lowest transaction in the top 100 list for the last 24 hours is 897BTC, the highest is above 1000, I stopped scrolling down once I saw 1000.

$775*1000=3/4s of a million dollars.  At least 100 transactions around that average occured in the last 24 hours. EVeryday the bitdoin network handles 100 transactions of over half a million dollars.

I can't teach you how to move this kind of money using bitcoin. But it appears its being done.

 

For those who refer to bitcoin as skynet. I think its neat we can see these things about our money...

yet no one right now can say anything about the people involved in the top 100 transaction of the last 24 hours.

only that mone moved. I dont see this changing in my lifetime and for that I love bitcoin.

Fuck you Bernanke!

Fri, 12/27/2013 - 23:49 | Link to Comment Harbanger
Harbanger's picture

Where there are no capital controls, genius.  I bought 100k @495 a couple of weeks ago.  What's your point?

Sat, 12/28/2013 - 00:01 | Link to Comment TheHound73
TheHound73's picture

The problem is with the banks (aka the government), not bitcoin per se.  If your friend can actually take possession of his funds and locate a bitcoin seller, his problems would be solved.

Sat, 12/28/2013 - 00:16 | Link to Comment Prisoners_dilemna
Prisoners_dilemna's picture

I lack stats on how much cash is moved worldwide so I can't compare the two.

Can anyone cash that guy out?

I cant.

 

It appears it was worth the effort to someone or some people because in the last 24 hours someone moved some serious funds, funny money unicorn electron thingy or not. Someone moved big money and believes they can either use it, hold it, or transfer it into a currency somewhere.

 

@Hardingle My point is that fonestar may not be moving millions daily... or ever...    but someone is using bitcoin for what you suggest theyre not.

So shut the f*ck up and let the adults talk.  :)

localbitcoins.com

Sat, 12/28/2013 - 00:13 | Link to Comment Harbanger
Harbanger's picture

Maybe you can tell me how to find Bitcoin seller that accepts cash for Bitcoins.  That would at least partially help him.

Sat, 12/28/2013 - 00:21 | Link to Comment TheHound73
TheHound73's picture

https://localbitcoins.com/country/AR

Lol, most of the sellers there look pretty small-time.

Sat, 12/28/2013 - 00:24 | Link to Comment Harbanger
Harbanger's picture

Thanks.

Sat, 12/28/2013 - 07:32 | Link to Comment goldflows
goldflows's picture

Hey kid.. LeRn a thing or 2 about liquidity.

If anything the sheer ridiculousness of the size of those "transactions" combined with the fact that it's difficult to trade BTC for cash .. At least I don't see Nyone pulling out 10mil from iit..

But yea, keep buying.. Bitchez

Sat, 12/28/2013 - 10:55 | Link to Comment Pseudonymous
Pseudonymous's picture

Capital controls would freeze Bitcoin use except for completely free trade.

Fixed it for ya.

Sat, 12/28/2013 - 07:12 | Link to Comment negative rates
negative rates's picture

Your friend must have a friend who can give him a hand out, then be repaid once he gets his feet back on more furtle ground in loco $.

Sat, 12/28/2013 - 00:42 | Link to Comment TheHound73
TheHound73's picture

I think it is time Bitcoin starts picking fights with smaller countries.  I would like to see a bitcoin duel with Iceland's capital controls.  Iceland is reasonably small, reasonable amounts of personal wealth, reasonably technologically advanced.  Argentina might work.  Ukraine is probably not technologically advanced enough yet.  China is probably too big to tussle with at Bitcoin's current (2013) level of maturity, but give it time.  

Fri, 12/27/2013 - 23:53 | Link to Comment IridiumRebel
IridiumRebel's picture

The cartel is NOT God, but they'll work to let you meet him/her earlier than desired. They are evil motherfuckers. Repeat that until it sinks in. I'd love to see a gold/bitcoin tag team bankster fuck, but they will nuke us from space before that is allowed.

Sat, 12/28/2013 - 10:50 | Link to Comment Pseudonymous
Pseudonymous's picture

If you are willing to apply such a logic for Bitcoin, then shouldn't you expect others to apply a similar logic about you and about what you have to say? With respect, could you tell us what makes you believe we should care about what you have to say?

Fri, 12/27/2013 - 21:15 | Link to Comment Yen Cross
Yen Cross's picture

    Good lord ! Stevens(RBA) will do anything to avoid lowering rates.  Stevens pulled a couple of Nowotnys' this month to jawbone down the aud.

   Stevens seems to think "terms of trade" are closer to aud/usd .8500. Perhaps before the global central banking cabal injected $15 trillion+. Stevens should be proud of his country. They have the lowest deficit of the G-20.

  Get used to aud/usd on the 90-100 handle Glenn. Your bonds are a hell of a lot more attractive then the pigs in 2014.

 

  Australia 10-Year [4.296] 4.281 4.316 4.261 0.015 0.35% 27/12
Fri, 12/27/2013 - 21:25 | Link to Comment Kina
Kina's picture

With NBA 6 mos I get 3.35%

Fri, 12/27/2013 - 21:31 | Link to Comment Kirk2NCC1701
Kirk2NCC1701's picture

If you trade it with Aussie Gold, it sure as hell will: 

[1] AU + BTC = FRN_killer

Repeat equation [1] 3x/day for next 3 weeks, or until it truly sinks in.  Gold = Store of Value, BTC = universal crypto-currency.

What one won't do for you, the other one will.

Fri, 12/27/2013 - 21:40 | Link to Comment Yen Cross
Yen Cross's picture

 I've seen some unique posts from your handle in the past. Are you sure that you want to take credit for the above post?

   I think I hear O'Hara and Bones calling?

Sat, 12/28/2013 - 02:44 | Link to Comment disabledvet
disabledvet's picture

It's Uhura http://www.youtube.com/watch?v=Tthrj2LBlm0 And if i could post pictures here i'd be a lot more fun. As far as bitcoin i would be very wary of that thing heading straight to zero right now. I think the Dutch view is spot on: "at least tulips bloom." Other than that...there is no "intrinsic" or "banking" risk. http://www.youtube.com/watch?v=MJYFrVPBv1I

Fri, 12/27/2013 - 21:27 | Link to Comment Atomizer
Atomizer's picture

Will the encrypted Bitcoin currency follow the Federal Reserve Note? This Bitcoin currency is legal tender for all debts, public and private [See one dollar bill, upper left hand section]. Success depends if the old legacy continues with a new debt relief digital currency.  Re-read that last sentence until it sinks in.

Fri, 12/27/2013 - 21:38 | Link to Comment q99x2
q99x2's picture

If trust in Central Banks, JP Morgan and Goldman Sachs determines if the dollar is useful as a currency...I guess we know where that one is going.

But about Bitcoin. Price fluctuation is due to the true value of Bitcoin being around $1,000,000 per bitcoin, not $1,000. So currently the price is based on speculation and not in goods and services. When the price is in Satoshis and raw materials as well as finished products and wages are in satoshis then price becomes a function of supply and demand Vs. today's speculation.

I say buy Bitcoin all the way up intil the price hits $750,000 per bitcoin.

Sat, 12/28/2013 - 07:43 | Link to Comment goldflows
goldflows's picture

I've got this bag of *shit* that *actually* is worth $100,000,000,000

It's price fluctuates since the aroma has not yet reached its maturity

Sat, 12/28/2013 - 08:18 | Link to Comment negative rates
negative rates's picture

Plus I know a guy who has controled a trillion dollars worth of commerce each day for the past 30 years. That make's Mr. B's itcoin small potatoes even by his own standards.

Sat, 12/28/2013 - 13:12 | Link to Comment chemystical
chemystical's picture

"true value of Bitcoin being around $1,000,000 per bitcoin, not $1,000"

That is a very bold statement, and one which you and a few others have made several times...without offering a scintilla of reason.

Once again, here's your chance to redeem yourself.

If your wild speculation is based on the expectation that Btc will replace a substantial % of USD and other fiat, and - more to the point - that it will replace them in commercial transactions, then I'd like to introduce you to the often-discussed scalability problem (and the ensuing problems of full validation, requiring trust of selected nodes who will volunteer or be chosen [by what/whom?] to do the full validation, etc, etc).

You can't say that "It works for now (and we'll cross the scalability bridge when we come to it)."  That single problem (among the many diverse problems that Btc faces) is a show stopper as it stands.  Proof of concept and WFN models in my industry (and most others afik) have a high failure rate when they meet the real world. 

21MM Btc x $1MM USD/Btc = $21 TRILLION USD.   That's 7X the adjusted monetary base.   Pretty lofty expectation you have. 

In the course of the ZH Btc/cc discussion history, I've read some very thoughtful and thought-provoking commentary from "pumpers", naysayers, goldbugs, fencesitters, etc.  Yours are not amongst them.

Fri, 12/27/2013 - 21:39 | Link to Comment q99x2
q99x2's picture

Thailand is a great example of what happens to a nation when they outlaw Bitcoin.

Fri, 12/27/2013 - 23:57 | Link to Comment NidStyles
NidStyles's picture

Thailand is what happens when you have a US backed Monarchy that has been raping the people for the past 60 years. It has very little to do with bitchcoin which is a non-news story on any level in Thailand where the majority of the country does business with cash and hard assetss because their internet is lousy.

Fri, 12/27/2013 - 21:46 | Link to Comment ChaosEquilibrium
ChaosEquilibrium's picture

...and once 21 million BTC's are reached......the next serial version will begin BTCA....then BTCB....then BTCC....then BTCD....whoa...before you know it.....derivative and arbitrage.....risk and leverage and credit deriviatives begin trading= Inflation-Deflation......it is NOT the trinket designed and printed.....it is Human Condition and finite resources!

Fri, 12/27/2013 - 21:47 | Link to Comment Yen Cross
Yen Cross's picture

  I did a small breakdown in different time frames, Re; BTC this morning>approx 8 hours ago.

  I like http://bitcoin.clarkmoody.com/   for it's simplicity.   BTC has moved approx $6.00usd in that time frame.

 If I purchased BTC on it's recent drop into the mid-high 500s', profit taking( reaquisition at lower rates) should be considered.

Sat, 12/28/2013 - 00:07 | Link to Comment TheHound73
TheHound73's picture

It is pretty fun and easy to trade BTC volatility but I usually get stuck on the fiat side of the trade.

A Proposed Inefficiency in the Bitcoin markets.

Sat, 12/28/2013 - 01:02 | Link to Comment Yen Cross
Yen Cross's picture

 

  I don't hate you Fone Star. I want to see you succeed. 

  When you mentioned Napster, my heart sunk. I know how it feels to be deep into a trade or feeling. That's normal.

  I also know when to cut my losses and diverse-ify. The best traders only get 1or 2 trades right out of every 10!

Fri, 12/27/2013 - 22:02 | Link to Comment Clowns on Acid
Clowns on Acid's picture

Sheila McObvious makes her statement.

Fri, 12/27/2013 - 23:25 | Link to Comment Dr Benway
Dr Benway's picture

Aussie bankers are unaccustomed to engage in any research that is not aimed toward shamelessly shilling some harebrained ponzi scheme. That's why this 'Bitcoin for dummies' reads so inane.

Check out my blog on Australian fund fraud:

http://drbenway.blogspot.com

Fri, 12/27/2013 - 22:07 | Link to Comment q99x2
q99x2's picture

Why do people not look back to May to make a comparison to see how bitcoin has stabilized in both price volatility and volume compared to now. Are they stupid?

As the base spreads out the volume drops and the price fluctuations (on a percent basis) normalizes.

Duh.

Fri, 12/27/2013 - 22:25 | Link to Comment dark pools of soros
Fri, 12/27/2013 - 22:13 | Link to Comment A Lunatic
A Lunatic's picture

If bitcoin falls prey to the regulators, banksters, and controlling governments it will effectively cease to be useful and another unit of trade will be established by those desiring to protect their natural right to engage in voluntary trade with like minded parties without paying tribute to a middleman..........

Sat, 12/28/2013 - 00:48 | Link to Comment Scarlett
Scarlett's picture

yeah, they sure banned drugs for good, didn't they?

Sat, 12/28/2013 - 12:45 | Link to Comment chemystical
chemystical's picture

"yeah, they sure banned drugs for good, didn't they?"

Your reasoning skills and reading comprehension are too facile for your own good.  (To wit: your post here and your prior statement that will blindly buy Btc because the banksters don't like it).  Please allow me to help you.

1) the poster to whom you responded wrote that if the authorities are threatened by Btc then by their response it will "cease to be useful".  That poster did NOT write "ban it."   That is not paltry semantics; that is a HUGE difference.

2) the state does not ban drugs.  the state makes the use of some drugs illegal.  Again, HUGE difference.  Speeding, spitting on the sidewalks, littering, and murder are also against the law.  The state deems those things to be against the public interest, and it takes measures to curb them.  The enforcement effort is directly proportional to the extent to which the action in question is deemed to be deleterious to the state or the people thereof.

I suppose that you would argue that there is no one in jail or prison for drug offenses?  That the state has collected no fines for drug convictions.  ($78 tickets for said infractions with marijuana are issued daily in my county).

Can the state ban anything?  No.  Can the state make it uncomfortable to violate the law?  Yes, and the more deleterious the more uncomfortable.

Your half-wit argument (which sadly has been repeated by some other slow wits and half wits in in the ZH community) discredits and does disservice to the thoughtful Btc "pumpers" and the ensuing debate.

With all due respect (i.e. NONE),

Chem

 

Fri, 12/27/2013 - 22:23 | Link to Comment dark pools of soros
dark pools of soros's picture

well they must of just wrote that report in the last week or so since btc-e was removed off of bitcoincharts recently and thus now seems invisible... lol..

 

 

Fri, 12/27/2013 - 22:36 | Link to Comment Yen Cross
Yen Cross's picture

  I'm sure you've noticed the wider spreads.  WTF ?  the exchanges are quoting insane common currency rates, and even(exponentially) crazier cross rates.  I know how to read block chains.

Fri, 12/27/2013 - 22:44 | Link to Comment dark pools of soros
dark pools of soros's picture

I wonder how coordinated the whales are...  that would be a good story..

Sat, 12/28/2013 - 00:33 | Link to Comment Yen Cross
Yen Cross's picture

 @ dark pools of soros  Good comment and concept.

   

    HUMANITY!

Fri, 12/27/2013 - 22:31 | Link to Comment Apostate2
Apostate2's picture

Excerpt from the SCMP (28/12/13). Seems that 'Superman' has a position.

'Investors looking for a way to make money from the global bitcoin bonanza should steer clear of the pseudo currency itself and instead follow Li Ka-shing's lead: buy in to the firms providing the services that bitcoin holders use. 

 

That's according to John Greenwood, the London-based chief economist of Invesco who designed Hong Kong's pegged currency regime.

"Just like investors in days gone by made more money out of selling shovels and picks to gold-diggers than anyone ever made out of the gold mine, he is investing in the peripheral activity that bitcoin has generated," Greenwood said.

Asia's richest man, Li Ka-shing has invested in BitPay, the digital currency equivalent of PayPal, through his venture capital company, Horizons Ventures.

A spokeswoman for Horizons Ventures said the group would not comment on the details of the investment.

BitPay said it was "fortunate to have the benefit of many supportive investors, including Horizons Ventures".

BitPay, founded in May 2011, handles transactions for 14,000 companies across 200 countries. About half are in the United States, with 25 per cent in Europe and 25 per cent in the rest of the world.'

Sat, 12/28/2013 - 00:01 | Link to Comment Prisoners_dilemna
Prisoners_dilemna's picture

"Bitcoin comes about as a response to quantitative easing and concern regarding central banks’ printing money. But what it cannot replicate is the revenue generating abilities of central banks and the governments that control them, or their inflation fighting credentials. Neither does it have the centuries of history that gold is backed by."

 

The author conveniently links the final sentence with those preceeding yet they are not at all related in topic. This is poor or malicious writing.

What should be mentioned is that gold may be back by "centuries" of market choice rather than nothing... yet bitcoin is four years old so of course it wont have "centuries of backing" as the author tells us.

2nd the final sentence doesnt even relate to the preceeding sentence as I mentioned above. The only way they could be linked is if the author is telling us that "Bitcoin comes about as a response to quantitative easing and concern regarding central banks’ printing money" and the readership were to subconsciously read "That's what gold is for".

Except gold is failing in its response to Central Banks. So mother necessity gave us the honey badger of money. Gold failed to restrict central bank shenanigans.

I predict bitcoin will succeed in this herculean task.

 

And what the f*ck is this??

" the revenue generating abilities of central banks and the governments that control them, or their inflation fighting credentials"

 

What the hell am I reading?!?!

Sat, 12/28/2013 - 00:27 | Link to Comment q99x2
q99x2's picture

"The scarcity can also be considered a flaw. The supply of Bitcoin is inelastic. There are periods of time at which an increase in the money supply is warranted, to meet demand and then cyclically reduced. Bitcoin does not allow for that. The current spike in Bitcoin is an example. Demand for it has risen (arguably on speculative grounds), and supply cannot match it; hence the rise from $100 to $1200 over four months."

Emma should have wished this paragraph never to be published.

Maybe she believes in astrology. Pluto has been affecting many Capricorns this year.

Sat, 12/28/2013 - 00:29 | Link to Comment q99x2
q99x2's picture

The other thing she fails to recognize is that bitcoin is as physical (if so desired) as paper dollars or as gold.

Sat, 12/28/2013 - 01:23 | Link to Comment Mad Mohel
Mad Mohel's picture

How's that? Last I heard the guy minting physical bitcoins got threatened with a cockmeat sandwich; he saw the light and repented his sins.

Sat, 12/28/2013 - 00:51 | Link to Comment q99x2
q99x2's picture

"With no macroeconomic backing, it is impossible to determine fair value for Bitcoin aside from demand and supply"

Holy shit is Emma saying that bitcoin is a capitalist currency?

Sat, 12/28/2013 - 01:18 | Link to Comment Mad Mohel
Mad Mohel's picture

I'm calling bullshit on durability and scarcity. There are too many factors involved for it to be stable and therefore durable. If for any reason you are deprived of internet or electricity, you're fucked. And the scarcity is also bullshit, there are many competing cryptocurrencies. BTC is the current flavor of the month. It will eventually be superceded and made obsolete, and this will probably happen sooner rather than later. BTC only has portability going for it. It is a hell of an advantage but it doesn't make it a good currency.

Sat, 12/28/2013 - 01:29 | Link to Comment Kina
Kina's picture

Bitcoin and the like Will be regulated in time, guaranteed. It will be regulated at the retail and wholesale end, where transactions are made. Simple matter of regulating that information on 'sales' of goods be captured and recorded for TPTB tax man.

 

So whenever you want to transact a purchase with bitcoin..over a certain amount I would guess, your ID will be required... or no sale. Plus if they want an additional tax.

Sat, 12/28/2013 - 02:04 | Link to Comment TheHound73
TheHound73's picture

Already covered by existing regulation.  At least Bitcoin takes banks out of the equation.

Sat, 12/28/2013 - 03:11 | Link to Comment Yen Cross
Yen Cross's picture

  You're welcome  ; Bitcoin Charts / Markets

Sat, 12/28/2013 - 03:24 | Link to Comment Clowns on Acid
Clowns on Acid's picture

Good chit ..Yen.. Thanks.

Sat, 12/28/2013 - 04:13 | Link to Comment Yen Cross
Yen Cross's picture

  good on ya.

Sat, 12/28/2013 - 03:32 | Link to Comment imbtween
imbtween's picture

This was a pretty thoughtful article for an establishment wonk. Thing is, btc is going to swing wildly until that 21 million mark gets hit and the specs go home. Once that happens and the market settles down, it will behave more like the conveyance/store it was intended to be. Til then trade your bulbs, hopefully at a profit. And be sure to report your capital gains when you cash out. 

Sat, 12/28/2013 - 06:01 | Link to Comment Laretes
Laretes's picture

I still do not see a way out of the deflationary scenario once all or nearly all bitcoins are mined.

Unlike gold, where they might still be another good mining location that has not been discovered, bitcoins are designed to have an upper limit, meaning their purchasing power will and almost have to ever increase once they are all mined.

Anyone have an idea to get out of that?

Sat, 12/28/2013 - 06:39 | Link to Comment Banjo
Banjo's picture

Yes like Rocky 1 through 5

Just roll the next crypto version. Trust me you can have as much crypto currency as your heart desires.

www.crypto-trade.com

Sat, 12/28/2013 - 10:46 | Link to Comment GreatUncle
GreatUncle's picture

Wish they had all been mined already...

Because what a bitcoin is worth then can be used to compare the amount of other currencies being created. LIKE HOW MUCH EXCESS YOU WANT TO THROW AT ONE because the currency you have is kind of worthless. It reveals the money creation action of central bankers and nothing like gold that has ETF's and you can go dig more up and even maybe one day learn how to create the stuff or pretend a vault that is empty is full of the stuff.

Worked this out a long time ago that the amount of money being created doubled the price of purchasing something in 10 years time. Never really thought about it but X required in 10 years is now 2X. Now in the run up to 2008 that money creation rate was like every 5 years so X required in 10 years was 4X.

Now let 1 bitcoin = 1K today ;-) Then with the ability to throw money at it through the extra money created by central banks in a decade 1 bitcoin = 4K+. Yay, you are no better off but the real issue in the system steps forward the rate of creation is to great especially if the lowest are locked out of the system.

What a person cannot afford today is not the issue, it is how little they will be able to afford in the future now < 1/4x all delightfully gamed out of existence by the central bankers and falling every day.

Leave you to figure the reaction as people see this future and realise this will be there future also and there is nothing they can do to change it. Get lucky people or be born as a 1%er.

Sat, 12/28/2013 - 06:38 | Link to Comment Banjo
Banjo's picture

BitCoin is a crypto currency. There are over 40 such currencies already in existance and growing. Don't think crypto is immune to hyper inflation.

Why will someon pay a million dollars for a bit coint if and when a retailer accepts alternate crypto for example government crypto?

Sat, 12/28/2013 - 07:24 | Link to Comment TheHound73
TheHound73's picture

Bitcoins currently have more security (in terms of the mining network) and more liquidity than the other alt-coins by a couple orders of magnitude.  Not saying that can't change but it is not expected to.  

P.S. you don't have to buy a whole coin, silly, you can buy any fraction you so desire.

Sat, 12/28/2013 - 20:36 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

writing pgp/gpg signatures on goldgrams as what's available from goldmoney.com would in fact be more secure & have real backing and take much less computing power.

I've addressed this a dozen times & you bit-tards refuse to even reply.

gpg / pgp had bitcoin's ass kicked since 1993.

Sun, 12/29/2013 - 01:36 | Link to Comment TheHound73
TheHound73's picture

goldmoney.com is centralized.  Homie don't play centralized games.  goldmoney.com has discontinued their debit cards except for a very tiny jurisdiction where they have a money transmitter license.

Out of curiosity, braniac, how much of your PMs have you entrusted with these goldmoney.com characters?

Sun, 12/29/2013 - 06:38 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

we can ALL be goldmoney.com - I think you're a retard.

EVERY ONE OF US can have PHYSICAL GOLD GRAMS and make PGP SIGNATURES for them.

That would kick the ass right out of bitcoin & it would also ensure a real backing for the currency.

I entrust my metals with no one: digital currencies are dangerously stupid, it's like putting a gun in your mouth and demanding someone put their hand on it.

No matter what every single digital currency will fail because they ONLY can fail.

Still better than bitcoin which has NO backing & a poor techology layered on top of a ponzi-fiat pump-n-dump scheme http://flic.kr/p/iFQMoV

Sun, 12/29/2013 - 21:35 | Link to Comment TheHound73
TheHound73's picture

Only time will tell, my friend.  Muahahahahahah.  Happy New Years.

<<EVERY ONE OF US can have PHYSICAL GOLD GRAMS and make PGP SIGNATURES for them.>>

What the fuck good would a PGP signed message about some gold do me?  It appears you are missing the whole point about bitcoin:  It allows frictionless delivery of the asset while ruling out double-spends and counterfeits.  Trying to produce the same results with a gold-backing will result in centralization, a big no-no.

Mon, 12/30/2013 - 23:12 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

it's backing. What good would a bitcoin do me? They are equally at zero level of trust, having nothing on the other end to give to me of value, yet I must sacrifice value irreversibly for bitcoin.
PGP signed gold-grams have value that bitcoin can't ever have.

Centralization and gold do not mix. They have always been opposites and always will be.

Bitcoin on the other hand makes an exponentially larger blockchain shared ledger which one day can't ever be handled by mere mortals, only super-computers with server-farms, cloud-storage and top-level banks only. ONLY. That's a fact. Denial of this fact is born either of ignorance or fraud. Which one do you use? PGP signatures put through peer to peer analysis is a billion times faster than bitcoin and would easily produce zero-centralized prevention of all double-spending.

Sat, 12/28/2013 - 09:29 | Link to Comment goldenbuddha454
goldenbuddha454's picture

Fiat Envy

Sat, 12/28/2013 - 09:29 | Link to Comment geewhiz
geewhiz's picture

It is very plausible to assume that speculation, not actual commercial use, is responsible for bitcoins frothy price rise. To me this is perfectly normal for something as monumental as a new form of world money making its debut on a world stage fraught with fire and confusion whose root cause is the adopted nature of the money now being used. Crytocurrencies not only address these issues but have bonus utilities as well, particularly in times like these. One is they allow a higher degree of anonymity and private untrackable trade transactions. They are not only convenient to use but a wonderful tool to starve the beast with.

To me the speclulators are only leading the way for the daily adopters. Free people everywhere will benefit greatly if a cryptocurrency goes mainstream. For the nearterm btc is a speculative investment with limited commercial use, for the future it will be the other way around. It is an idea whose time has come.

Sat, 12/28/2013 - 09:46 | Link to Comment mademesmile
mademesmile's picture

A better question is

"Will Dollar Replace Toilet Paper?"

Sat, 12/28/2013 - 10:02 | Link to Comment GreatUncle
GreatUncle's picture

I really liked this comment at the end and it really shows how you view a world bt the currency you live in.

However, there is a large red flag saying buyer beware at current levels of price and use. With no macroeconomic backing, it is impossible to determine fair value for ________ *fill in the word.

Could be bitcoin ... there again it could be dollars, pounds, euros, yen even food stamps!

The macroeconomic backing is real productive worth to support the currency.

Comical you have here an individual "National Australia Bank's Emma Lawson" that believes in the Aussie currency and a banker throwing speculation about the possibilities of bitcoin when all those things you try to measure btc by are those same things people use to measure fiat currency = aussie dollar too.Ha, ha.

Absolutely priceless comparison and sheds real light on what the current ausie dollar is about don't ya think?

Sat, 12/28/2013 - 15:24 | Link to Comment devo
devo's picture

My snot is portable, divisible, recognizable, and scarce. People need to stop making the awful argument that those things equal valuable.

Sat, 12/28/2013 - 15:58 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

http://flic.kr/p/iFQMoV

bitcoin Fail approaching - not a smart choice. As for grid failure, aging transmission wires & also possibly having wires cut deliberately - the last thing I want is a so-called "money" that can't actually work without an underlying fully operational PAIR of grids - one for power, one for communications - that would be sheer lunacy. The time I need money most is when neither are working.

Sun, 12/29/2013 - 00:38 | Link to Comment TheHound73
TheHound73's picture

But you use money everyday.  So... you strongly recommend gov't fiat for everyday purchases?  Thanks for the tip, bubba!

Sun, 12/29/2013 - 06:39 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

Your IQ is negative. I use DEBT notes handed by my employer because legally I have no choice and I use DEBT NOTES to pay taxes by LAW. I use MONEY (gold, silver) when no one's trying to put me in jail for it. DEBT NOTES aren't money.

Sun, 12/29/2013 - 21:50 | Link to Comment TheHound73
TheHound73's picture

<<I use DEBT notes handed by my employer because legally I have no choice>>

Sucks to be you.  The quality of my work is such that I demand my employers ONLY pay me in gold or bitcoin.  I have more self-respect than to work for anything else.  You are implying I am breaking the law?  1) Cite the relevant laws  2) I don't care what the laws say anyways.

Mon, 12/30/2013 - 23:12 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

I'm going to imply that you're lying. You have no choice but to pay in dollars and 99% of people using bitcoin are seeking dollars using them.

I will outright say that what you claim is 100% law-breaking because you MUST Pay taxes and MUST use dollars to do so. IRS will bring people to shoot you to swiss cheese if you resist arrest for not paying, and will take payment in dollars, not gold or bitcoin.

You DO care: you are in the police-state and know very well they'll shoot you where you stand for any level of defiance.

Wed, 01/01/2014 - 03:15 | Link to Comment TheHound73
TheHound73's picture

To pay tax I convert the necessary amount of BTC to USD and send it off to Uncle Sam.  Get a brain.

Wed, 01/01/2014 - 12:53 | Link to Comment MeelionDollerBogus
MeelionDollerBogus's picture

For everything? Every monthly bill, every transaction, because by law you must pay taxes on that too?

Your story isn't credible. Those taxes all must be paid and all in dollars, not bitcoin.

There's not enough people with gold + bitcoin to live as you claim. ALL those people around you would need to be inundated with gold coin & bar, with bitcoin, all the time for your claims to be even possible.

You're full of it. Nice dream but it's clearly not reality.

Sat, 01/04/2014 - 22:38 | Link to Comment arkel
arkel's picture

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