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50 Fascinating Facts About Bitcoin

Tyler Durden's picture




 

We have previously illustrated how a Bitcoin transaction works, and the history of the virtual currency, However, we thought that this infographic neatly covered many interesting bitcoin facts in a digestable form. It not only shows the versatility of the bitcoin market, but it also captures the difference of opinion on cryptocurrencies: many embrace the technology, but some institutions show signs of hostility. Chinese banks have banned bitcoin trading and Thailand outlawed it straight up.

 

Click image for huge legible version

 

Source: VisualCapitalist

 

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Fri, 06/13/2014 - 21:00 | 4855494 hangemhigh77
hangemhigh77's picture

BitCoin=Computer Gold

Fri, 06/13/2014 - 21:02 | 4855497 kowalli
kowalli's picture

bitcoin is a shit to bail out people money=)

Fri, 06/13/2014 - 21:21 | 4855535 Publicus
Publicus's picture

Peer to peer currencies are the future. It literally changes the game. When it comes to the dollar system, the only way to win is to not play. But if you don't play, you starve. Peer to peer currencies solves this dilema nicely. Simply change your economic activity over to peer to peer currencies that you and other in our peer to peer economic system can print ourselves.

 

Gold and silver are the same as the dollar in that you can not print it. They enslave. Peer to peer currencies on the other hand, liberates.

Fri, 06/13/2014 - 21:33 | 4855567 Dr Benway
Dr Benway's picture

Bitcoin is manipulated like a penny stock. And when dealing with manipulated penny stocks, if you aren't one of the manipulators, then you are one of the fools.

 

Do you bitcoin idiots really think that the sea of liquidity currently sloshing around the world, that has been used to manipulate and ramp EVERY paper asset, magically hasn't been used to manipulate bitcoin?

Fri, 06/13/2014 - 21:36 | 4855570 Publicus
Publicus's picture

Bitcoin is just one out of the many peer to peer currencies. They are the reserve currencies of the future upon which everything else is judged. Note that peer to peer currencies are not assets, they are the units of economic activity, nothing more, nothing less. They will set us free.

Fri, 06/13/2014 - 21:46 | 4855599 Dr Benway
Dr Benway's picture

LOL. Nice incoherent rambling, sounding like a schizophrenic.

But answer my question, please?

In your opinion, has the torrent of ZIRP liquidity been used to manipulate and ramp the price of bitcoin? Or have the criminals magically left bitcoin alone?

Fri, 06/13/2014 - 22:44 | 4855760 gh0atrider
gh0atrider's picture

 

 

                           HO    LEE

                                                               FUK!!!!

 

                MOAR BITCOINZ!!!!

Fri, 06/13/2014 - 22:47 | 4855763 gh0atrider
gh0atrider's picture

As a side note, gh0atrider tried to purchase some moar Bitcoin today...

SELLERS:  Bitcoin isn't going to spread very well if you make it as difficult as possible to get coins!  We just want to click next and go to checkout!  We are not taking photographs of ourselves, booking time off work, sending you DNA samples, etc, etc, etc.  For the love of Christ!!

Fri, 06/13/2014 - 23:56 | 4855860 OpenThePodBayDoorHAL
OpenThePodBayDoorHAL's picture

Try Mycelium wallet Local Trader. Finds someone on Google maps willing to exchange. Usually within 0 miles.

Fri, 06/13/2014 - 23:59 | 4855871 gh0atrider
gh0atrider's picture

gh0atrider is ultra rural so there will definitely be nobody within 0 miles, or 500 miles.  And if they got close to ghoatrider they would leave anyway.

Sat, 06/14/2014 - 00:39 | 4855921 Pinto Currency
Pinto Currency's picture

 

Welcome the trojan bitcoin into your life.

Sat, 06/14/2014 - 02:07 | 4855995 Colonel Klink
Colonel Klink's picture

Queue the endless blatherings of Goatfucking Pornstar.

Sat, 06/14/2014 - 10:50 | 4856463 mcguire
mcguire's picture

if you are interested in supporting 9/11 truth, you can donate IN BITCOIN to the High-Rise Safety Initiative  

http://highrisesafetynyc.org/donate/

this initiative is trying to work the local political level, forcing an independent investigation as to why wtc7 collapsed as it did.  

Sat, 06/14/2014 - 11:59 | 4856606 mmanvil74
mmanvil74's picture

In a ZIRP world, the price of everything is manipulated to a greater or lesser degree.  The challenge for the investor is to determine if prices will be manipulated up, or down over x time frame.  

Of course the price of Bitcoin is being manipulated (to some degree), but the PRICE of Bitcoin does not matter to the merchants who use it for payment processing, or to the people who use it to transact internationally.  

Bitcoin's ability to process payments undercuts Western Union, Visa, and Mastercard by a large margin, regardless of whatever the price of Bitcoin in USD happens to be.  That is why Bitcoin is valuable, because it provides a better and cheaper way to move money around the world.  

Blockchain technology, upon which Bitcoin is based, is capable of disintermediating many more attributes of the old world economy - not just payments, but stock and bond ownership and transfer, escrow services, trust services, deed registration, the list goes on.  

Even if Bitcoin fails, there are hundreds of other currencies to fill its place.  Only a fool would ignore the innovation that Bitcoin brings to the table, regardless of who may or may not be behind it, crypto is the Future Of Money.

Sun, 06/15/2014 - 02:47 | 4858060 PhysicalRealm
PhysicalRealm's picture

in response to mcguire above:

WTC7 - proven to be controlled demolition

http://www.paulcraigroberts.org/2014/06/03/wtc-7-now-proven-case-controlled-demolition/

 

Sat, 06/14/2014 - 07:27 | 4856188 shouldvekilledthem
shouldvekilledthem's picture

It's difficult to obtain because of the government is trying to suffocate it (with not much success so far).

once you are in bitcoin it's a completely different world. :) 

Fri, 06/13/2014 - 23:07 | 4855792 tmosley
tmosley's picture

The nature of bitcoins means that they can only be manipulated upwards through purchasing, or downwards through selling of seized coins.  Far from the system of infinite selling of paper gold and silver that we have now.

It's not "magic", it's "different" in that it is a real market with real participants.  Weird I know, but it is the next frontier.  Best to get in now while its cheap. 

Bitcoin for transacting, gold for saving, bitchez.

Sat, 06/14/2014 - 01:21 | 4855952 Matt
Matt's picture

Unless you are on an exchange, in which case it is possible for people to buy and sell bitcoins that do not exist. There is no proof an exchange has all, or even any coins, and they can operate at any reserve ratio they want. Or they could get robbed or simply misplace some or all of their cold storage.

Sat, 06/14/2014 - 08:57 | 4856273 Matt
Matt's picture

Prove to me what addresses you own.

Sat, 06/14/2014 - 02:09 | 4855999 echoes
echoes's picture

Thats exactly what happened to Mt Gox, they were operating on ZERO reserves since 2011 and finally collapsed earlier this year with 800,000 "coins" that none of it's clients will ever see. The idea that tulipcoin cant be manipulated/suppressed/ponzi'd up is something only a shmuck would believe.

Sat, 06/14/2014 - 02:29 | 4856013 shitco.in
shitco.in's picture

Do you know how to read?

Covering all balances

Thomas said the audit was very strict, but at the same time it maintained “absolute privacy” for customers. He also added that Kraken have expressed interest in conducting regular audits in the future, with different auditors each time. Thomas said:

“I am attesting to [...] the root hash of a merkle tree containing all balances that were considered in the audit. If you are a customer of Kraken, you’ll be able to verify using open-source tools that your balance at the time of the audit is part of this root hash. If it is and if you believe that I am trustworthy, then you can be confident that your balance was covered by 100% reserves at the time of the audit.”

Using the ‘Merkle Tree’ technique originally proposed by bitcoin developer Greg Maxwell, the auditor went on to explain the gritty technical details. He was provided with a JSON file from Kraken, which contained the list of the exchange’s addresses and balances. The file was then compared against a copy of the block chain.

The results were in order, Thomas concluded: ”The actual holdings were very slightly (< 0.5%) above the required holdings, meaning Kraken had greater than 100% reserves at the audit block height.”

A competitive edge

Following the Mt. Gox crisis, many exchanges are keen to distance themselves from the troubled exchange and other bitcoin outfits with a chequered track record. Security and transparency have become selling points, hence exchanges appear to be doing their best to reassure investors on a regular basis.

Earlier this month UK-registered bitcoin exchange Bitstamp released the results of its own financial audit, which found that it held 100% of its validated BTC balance and USD funds. No issues were raised by the auditors.

Bitstamp CEO Nejc Kodri? told CoinDesk that his company plans to perform regular audits, with quarterly results posted on the Bitstamp website.

As investors demand more security and transparency, exchanges have to oblige or suffer the consequences and lose their competitive edge. Low fees are just one way of remaining competitive, but transparency and sound reporting practices might prove more important in the long run.

Sat, 06/14/2014 - 03:26 | 4856032 echoes
echoes's picture

Hey shmucko, Gox was "audited" as well. Any exchange can get one of it's insider buddies, seen as legitimate by the sheep, to rubber stamp the racket. Karpeles himself was an 'honorable member of the Bitcoin Foundation'. 75% of the total tulipcoin exhanges have gone down in flames and not a single person has been prosecuted.

Side note, how obvious is it that the tulipcoin trolls are spamming this forum like a mofo. They only post on tulip threads nowhere else, and on a downvoting binge. Get a life, sell your scam somewhere else.

Sat, 06/14/2014 - 03:57 | 4856076 shitco.in
shitco.in's picture

I am not sure if you are mentally challenged or just technically incompetent.  

The original post by Matt: http://www.zerohedge.com/news/2014-06-13/50-fascinating-facts-about-bitc...

There is no proof an exchange has all, or even any coins, and they can operate at any reserve ratio they want. 

 

And here is my response.  Try asking the Fed to see their proof of gold reserves. 

https://www.kraken.com/security/audit

Kraken Proof-of-Reserves Audit Process

See also: How to verify your Kraken account balance's inclusion in the audit.

Introduction

This document provides background and guidance regarding Kraken’s audit process.

Kraken holds full reserves, and we employ an independent, cryptographically-verified audit in order to prove to third parties, including our customers, that customer funds are properly held. Transparency and independently verified audits are critical to ensure that companies hold full reserves of customer funds. A public proof-of-reserve scheme is technically possible to implement. However, there are important externalities, user privacy among them, that must be carefully considered in the specific implementation of a public proof-of-reserve scheme. We believe that exchanges and wallets must build trust through accountability and that we bear a responsibility to address the community's desire for transparency.

Over the past several weeks, Kraken has successfully developed and completed an industry-leading, independent, cryptographically-verified audit. We are proud to submit this overview of our process to the global digital currency community. We believe that the Bitcoin industry is capable of providing a level of assurance and accountability that surpasses the traditional financial services industry, and we aim to lead the charge toward optimal transparency.

Current Landscape

The impetus for this initiative is Greg Maxwell's proposal for exchanges/wallets to prove their Bitcoin reserves. [1]

To date, audits produced by the Bitcoin industry have been opaque, superficial and without publicly viewable and independently verifiable cryptographic verification. Kraken seeks to provide a proof of concept and set industry standards of greater transparency and accountability from the digital currency ecosystem that others can follow and improve upon.

Quality of Process

Maxwell’s proposal would have required bitcoin companies to reveal all of their balance-containing addresses. This method would result in the public knowledge of exchanges’ or wallet providers’ bitcoin wallets and total holdings, information that is commercially sensitive and presents potential security risks to companies and users. Worse, it would result in an impermissible breach of user privacy, in which the history and trajectory of the individual holdings and financial activity could be tracked by third parties without cause or due process.

Our process does not require us to disclose our total balance, addresses, or keys to the public. By combining and leveraging the strengths of both a trusted auditor and publicly-verifiable cryptography, the Kraken audit represents the ideal balance between privacy and transparency.

Since Bitcoin is the dominant cryptocurrency, our initial audit will cover only Bitcoin reserves. However, audits for other assets will be considered for future development.

Process Overview Phase 1 - Auditor checks the funds of Kraken’s entire wallet

Kraken gives the auditor all of our public addresses and signs them. The block hash at the time of signature is part of the signed message and can be used as a timestamp for when the signature was made. The signatures of those public addresses will then be verified, and the auditor will use the bitcoin blockchain to extract the total amount available at those addresses at a certain point in time.

The code required for this phase was written by Michael Gronager, COO at Payward, and may be open-sourced in the future in its entirety. However, most of the code is already open source because the code is libcoin-based. [2]

Phase 2 - Auditor checks that the balances of Kraken users match with the funds of the Kraken wallet

Kraken gives the auditor the BTC balances of each one of our users and generates a Merkle tree. The auditor will publish the root node hash for all to see, and affirm, if true, that the total holdings represented by the root hash closely approximates the value that he sees in our wallet from the blockchain. This flow also ensures that Kraken is not hiding anything in any of the nodes that lead up to the root node.

For this phase of the audit, the auditor will have access to the source code for the tree-generating program and the individual account balances data file. Kraken released C++ code for this phase under the MIT License: https://github.com/payward/krakendb

Phase 3 - Users independently verify that their account balances were included in the data used by the auditor

Kraken gives users the amount that we reported to the auditor, as well as the nodes (and adjacent nodes) from their account to the root (which matches the one published by the auditor). We also disclose the hashing method used to generate the hash for their node, so that they can verify that the node does represent the amount that we claim it does.

This will enable users to independently check for themselves that their account was included in the data verified by the auditor.

Shortcomings

In this section, we describe some of this audit’s shortcoming. Note that this is obviously not an exhaustive list of weaknesses. However, because we value transparency to our users, we are providing informal background on specific shortcomings we have thus far identified in the auditing process.

Unlike physical assets, information need not be removed from one’s possession to be taken into possession by another. Thus, Kraken or another company employing this auditing method cannot prove that private keys have not been duplicated by an attacker. We also cannot prove that we have exclusive possession of the audited funds. We can only prove that at the time of the audit, we were one of the possessors of the private keys.

The full audit probably cannot be performed on-demand, without prior notice. Given the required information, structure of the audit, and industry standard cold storage security practices at this time, a surprise same-day audit is not feasible. We envision a potential ‘light’ audit building upon a prior full audit, relying on previously-generated signatures, which may be performed more frequently.

The auditor must be trusted and competent. The community must believe that the auditor values her reputation and is technically capable. There are several opportunities in this audit process where a less technical or less paranoid auditor could be duped by the auditee. There are also opportunities for the auditor to intentionally or inadvertently compromise confidential company and customer information. Both auditor and auditee must consider who provides the computer, the audit space, the blockchain, the Internet connection, the router, DNS, etc. If the goal is to hide a billion-dollar fraud, one can imagine going to great lengths to compromise the audit.

The audit is not continuously renewed in real time. It is possible that keys were lost or funds were stolen since the last audit time. The full audit renews the affirmation that keys have not been lost, though it creates greater threat exposure because it is necessary to utilize the cold storage keys to conduct the audit.

The auditee may be able to borrow funds temporarily or share keys with the true funds owner in order to pass an audit.

The auditor may collude with or succumb to threats from the auditee.

Ongoing Basis

We intend to perform regular audits on an ongoing basis. Since there is no universally trusted auditor, we may use a different auditor, or multiple auditors each time. This satisfies those who may doubt the credentials of a particular individual auditor.

Future Changes and Improvements

We hope to receive feedback from the community that will help us and others to improve this process for future audits. As members of this community, we also hope to work with industry organizations such as DATA (www.datauthority.org) to help develop basic standards, scalable tools and a comprehensive manual for others in the industry to perform similar audits.

References

 

[1] Summary by Zak Wilcox: https://iwilcox.me.uk/2014/proving-bitcoin-reserves. We want to thank Greg Maxwell for his ideas.


[2] libcoin is the transformation of bitcoin into modular, reusable libraries: https://github.com/libcoin/libcoin

 

How to verify your individual Kraken account balance in the Kraken audit

See also: Kraken Proof-of-Reserves Audit Process.

These instructions explain how to cryptographically verify your Kraken account balance and its inclusion in the audit.

This verification will reflect your account's Bitcoin (XBT) balance at the time of the audit.

Step 1

If you haven't already logged in, log into your Kraken account.

Go to https://www.kraken.com/ and ensure that your browser’s address bar shows "https://www.kraken.com/"

Step 2

Click "Funding" tab -> "Audit" subtab -> "Bitcoin (XBT)" on the left.

 Figure 1. Kraken Bitcoin Audit page. 

Step 3

View the information about your account verified by the auditor

  1. The Time of the audit, which is the timestamp used by the auditor.
  2. The Submission code, which is a 64 bit salt.
  3. The Amount of Bitcoins held in your account at the time of the audit. This is the balance value for your account that we provided to the auditor.
  4. Notes include information from the auditor proving the root hash that was used for the audit. A link to a signed, detailed report is also provided.
  5. The Hashes from your node hash to the root hash, including adjacent hashes. Hash values in your direct path are shown with an asterisk (*) to differentiate them from the adjacent node hash. With these hashes, you can verify that your node was included in the root:

    The very first line should match the root hash value given by the auditor.

    If you want to verify your own node hash (the very last hash with a * on the list), do:

    sha256(sha256(<submission code> || ":" || <amount with decimal point removed and leading 0's removed>))

    That value should match the very last value given in the hashes.

    Example code

    Submission code: 379377cd8190f9bf
    Amount: 0.01500000

    Python

    import hashlib; print(hashlib.sha256(hashlib.sha256(b'379377cd8190f9bf:1500000').digest()).hexdigest());

    PHP

    echo hash('sha256', hash('sha256', '379377cd8190f9bf:1500000', true));

    Result

    66b51ba0f4a5cf8278acac6782ffdfb9a64b9f7c895bc308266b0757c7025b27

    You can fully verify your Merkle branches by doing a hash of each pair of hashes (or “tuple”). The format is:

    sha256(left-hash || right-hash)

    The result should match the preceding tuple hash (or the root hash) with a * in it. This would be done for all tuples.

    With the exception of the root hash, all hashes are given as tuples, representing the left-hash and right-hash in that order. A * is given to the hashes that represent your direct nodes.

    Example code: Hashes: 306daae528dc137c9053554c45e90a631ef859490a3ede651d488135602500a3* c3fb1f931c681f4a7b779fb19e107bba156cae78c3a928707c42b395b056541b* 5e01ee0fee85641dd5cd4e3005792f973a2a1362180783041eb1719163b1d21c

    Python

    import hashlib; print(hashlib.sha256(b'c3fb1f931c681f4a7b779fb19e107bba156cae78c3a928707c42b395b056541b5e01ee0fee85641dd5cd4e3005792f973a2a1362180783041eb1719163b1d21c'.decode('hex'))).hexdigest();

    PHP

    echo hash('sha256', hex2bin('c3fb1f931c681f4a7b779fb19e107bba156cae78c3a928707c42b395b056541b5e01ee0fee85641dd5cd4e3005792f973a2a1362180783041eb1719163b1d21c'));

    Result

    306daae528dc137c9053554c45e90a631ef859490a3ede651d488135602500a3
Sat, 06/14/2014 - 09:16 | 4856305 tmosley
tmosley's picture

The Mt. Gox collapse made the system stronger, and it is no longer vulnerable to centralization of trading (ie people actually learned their lesson), as many more exchanges have opened, and volume is spread more evenly among them.  Also note that Mt. Gox PAID for its misdeeds, and collapsed, rather than being propped, and the bad behavior only lasted a couple of years, versus many decades with the PM markets.

Bitcoin is less manipulated than gold.  Cryptos in general are the least manipulated asset in the world right now.  Ignore them if you want, but you'll be exactly as sorry then as you are now that you didn't buy even $1000 worth back in 2012 for a hundred bagger like so many did.  I'm not going to make that mistake again, especially so now that I have learned the full story about how they work.

That said, Bitcoin is NOT very anonymous.  If you want anonymity, go for Darkcoin instead.  It is fully fungible into bitcoin, and can be traded for it "anonymously" (they have your IP, but you can give a fake name and throwaway email--there is no identity verification required) on many exchanges.

Sat, 06/14/2014 - 10:41 | 4856448 One World Mafia
One World Mafia's picture

Take a look at Bitcoin cryptography "guarding" mining and your private keys:

SHA256

RIPEMD160

SECPK1

Bitcoin is built on SHA-2, the 6th generation of published NSA cryptology hash's, all of the previous five generations were open source and all were eventually discovered to contain mathematical backdoors.

SHA-256 and RIPEMD160 ARE hackable:

https://blog.skullsecurity.org/2012/everything-you-need-to-know-about-ha...

http://www.infowars.com/bitcoin-revolutionary-game-changer-or-trojan-horse/

...and secpk1 which is not fully rigid, leaving room for an NSA backdoor.

http://safecurves.cr.yp.to/rigid.html

The NSA was exploring cryptocurrencies in 1996.  No doubt the govt has a gigantic stake in ensuring all cryptocurrencies have backdoors.

Sat, 06/14/2014 - 11:00 | 4856473 TVP
TVP's picture

This is the kind of crap that gives people grounds to call us all paranoid.  

Yeah, the NSA created the algorithms.  SO WHAT?

Big deal.

As if an agency that's already omnipotent has something to gain by controlling a new form of currency, when the current one is already controlled by the Fed?  

Don't give me that mark of the beast crap or start quoting the bible, either. 

Sat, 06/14/2014 - 12:26 | 4856671 One World Mafia
One World Mafia's picture

I answered your "so what" question, but you are out to promote Bitcoin no matter what.

Sat, 06/14/2014 - 12:33 | 4856692 tmosley
tmosley's picture

FUD aside, if the cryptography has a backdoor, then we're all fucked anyways, because its the same that's used to protect our nuclear missiles.  

Again, the only way to destroy bitcoin is to destroy the world.

Sat, 06/14/2014 - 13:14 | 4856782 One World Mafia
One World Mafia's picture

Backdoors negate the whole point of cryptocurrency:  to get away from govt manipulation of money.   Why not put your energy into demanding a cryptocurrency that is free from govt control?

Sat, 06/14/2014 - 22:44 | 4857873 TheHound73
TheHound73's picture

$7 billion reward to the guy who breaks bitcoin.  TImes a'wastin', homeslice. Better get crackin'.  Start here: https://github.com/bitcoin/bitcoin

Sat, 06/14/2014 - 10:57 | 4856471 TVP
TVP's picture

 

Bitcoin is not rising in price.  Fiat currencies are collapsing.

When the price of bitcoin goes up, fiat currencies are disappearing from the world and going into cryptocurrency format.  

Yes, there was manipulation at Mt.gox, that played a big role in the twin bubbles of 2013 and ensuing collape of mt.gox exchange.  It can happen with any currency.  

The truth is, if you put five grand into silver in March 2013, you've lost %30 - %50 of your investment.  If you put five grand into bitcoin, you've made well over a 1000% return on your investment.  

Do the math, genius.  

Fri, 06/13/2014 - 22:39 | 4855750 stopthejunk1
stopthejunk1's picture

"They will set us free."

You are drowning in KoolAid.

If you think that the moneyed classes are not going to ass-rape you with BitCon the same way they've ass-raped you with every other asset or currency for the last 5,000 years... well then, you will find out shortly that you are dead wrong.

Fri, 06/13/2014 - 23:56 | 4855861 gh0atrider
gh0atrider's picture

Fuck you.  The money masters are powerless against Bitcoin you shmuck.

Sat, 06/14/2014 - 00:29 | 4855916 zaphod
zaphod's picture

It is the ability to create money, and only the ability to create money, that gives the money masters and governments their power.

Take away the power to create money and the money masters lose all power and governments are forced to live within their means. 

In bitcoin you have a fixed supply. If you understood how the FED is able to manipulate the dollar and banks, it would be clear that they would be powerless in a fixed supply bitcoin world. Even if the FED acquired a decent supply of coins (lets say the FED was Satoshi) that is all the coins they would have. If they provided "liquidity" to banks as they do today, very quickly the FED would run out of coins and market forces would take over. 

Sat, 06/14/2014 - 02:12 | 4856000 Matt
Matt's picture

Step #1: acquire some bitcoins

Step #2: issue fractionally reserved paper notes (or digits) backed by, and redeemable in, bitcoins

Step #3: eventually, after 99% of people do not redeem for bitcoins, close the "Bitcoin Window", making your paper notes not redeemable in bitcoins.

They did it with gold, why do you think bitcoin would be any different?

Sat, 06/14/2014 - 03:15 | 4856034 stacking12321
stacking12321's picture

no, your analogy is completely off!

they did not "do it with gold", they did it with the dollar! the dollar is the fake iou note, gold is the real thing. that's why you want to hold gold not dollars.

so if they similarly offer some type of paper currency "backed by bitcoin", it is the paper currency that would be the fraud. bitcoin would still be bitcoin, 100%. that's why you want to hold bitcoin not some derivative.

 

Sat, 06/14/2014 - 09:00 | 4856279 Matt
Matt's picture

The exchange rate for the bitcoins would be manipulated. With gold now, you have futures contracts where 99% is settled in dollars and only 1% is delivered. 

Sat, 06/14/2014 - 13:32 | 4856818 TheHound73
TheHound73's picture

If you only take 1% delivery on a contract, you, sir, are an idiot. Now, taking delivery of gold is expensive and time consuming. But that's what you get for messing around with shiny rocks. If you take less than 100% delivery on a bitcoin contract you are doubly an idiot. It is trivially easy to deliver any amount of bitcoin anywhere anytime for less than a penny.

Sat, 06/14/2014 - 03:16 | 4856035 stacking12321
stacking12321's picture

.

Sat, 06/14/2014 - 09:17 | 4856306 tmosley
tmosley's picture

>Therefore you shouldn't buy gold.

Great logic there, Ben.

Sat, 06/14/2014 - 11:05 | 4856482 therover
therover's picture

Do you really believe there is a 'fixed supply' in the algo world ?

The only thing finite is the Earth itself, and certain elements within it than cannot breed or reproduce and that can only be mined or extracted. Mining and extraction take physical labor, hence expended energy to produce...a true measure of work. A flick of the wrist button push to create something in the algo world is not work.

Interesting how Bitcoins are 'mined'. Just a play on words to make those think the thing is finite.

Money is not created today...currency is created today. Infinite amounts in all types of shapes and sizes.

True money is finite and requires WORK to be created and exchanged.

 

Sat, 06/14/2014 - 23:56 | 4857970 TheHound73
TheHound73's picture

Yes, I believe there is a fixed supply of Bitcoins. When all is said and done I believe 21 million of them will have been created.  I believe just under 13 million have been created to date.

Fri, 06/13/2014 - 21:41 | 4855597 TheHound73
TheHound73's picture

Bitcoin is possibly the most manipulated market out there.  There are no regulations whatsoever.  Welcome to a free market, pal.

Fri, 06/13/2014 - 21:45 | 4855606 Dr Benway
Dr Benway's picture

Except some can borrow cash ZIRP. How the fuck is that a free market? And how do you expect to get "market" pricing under such a regiment?

 

Bitcoin adherents just parrot soundbites, trying to sound vaguely profound.

Fri, 06/13/2014 - 21:54 | 4855635 TheHound73
TheHound73's picture

> "And how do you expect to get "market" pricing under such a regiment?"

If you posses bitcoin, how much ZIRP cash would you accept in exchange for it?

Conversely, If you posses ZIRP cash, how much of it would you plunk down on Bitcon?

Where these meet is how merchants calculate the exchange rate while selling goods and services for Bitcoin.

Bitfinex has recently become the leading Bitcoin <--> USD exchange in terms of volume: https://bitcoinwisdom.com/markets/bitfinex/btcusd

 

Fri, 06/13/2014 - 23:19 | 4855805 NidStyles
NidStyles's picture

Nothing priced in dollars can be called a Free-Market by the very way the Federal Reserve Dollar system works. If it's priced in these USD's then the price you are seeing is artificially being represented.

 

It's called Gresham's Law. This has been discussed more than once on ZH, and it's embarassing that we have to continually explain the basics to you guys. 

Fri, 06/13/2014 - 23:45 | 4855841 TheHound73
TheHound73's picture

Price bitcoin in chickens if that is what you prefer.  Nobody is stopping you.  You just have to find a party for the other side of that trade.

Sat, 06/14/2014 - 00:06 | 4855880 gh0atrider
gh0atrider's picture

gh0atrider likes to price his BTC in silver.  Silver is falling fast!  ;)

Sat, 06/14/2014 - 03:18 | 4856037 stacking12321
stacking12321's picture

not any more.

the triple bottom is in at 19.

that's going to be one helluva base!

Sat, 06/14/2014 - 05:44 | 4856117 TheHound73
TheHound73's picture

I think he means in terms of bitcoin, not YellenBux.

Sat, 06/14/2014 - 04:57 | 4856102 conscious being
conscious being's picture

Silver is not falling, so it certainly can not be "falling fast".

You have just acquired zero cred for you and your btc story.

While btc has value for the time being as a way to avoid currency controls, it has numerous fatal flaws.  

Someone points out up thread the opinion that btc has value because the design limits the amount of "coins" that can be issued.  But there is no limit on crypto coins from infinitely repeatable copies or worse for btc, improved mods of the btc system.

So, you are left with 'first mover' advantage, which will only dissipate with time.  In fact, what's the spread with litecoin?  Let me guess, its closing.

Sat, 06/14/2014 - 05:59 | 4856125 TheHound73
TheHound73's picture

I think he means falling in terms of Bitcoin, not YellenBux.

First mover advantage is pretty big when it comes to money.  Also there is the strength of the mining network, real-world opportunities to spend the currency. and liquidity issues to consider.  Put it this way, if you had $1,000 to invest in crypto-currency would you go out and buy the one with $ billions in market capitalization and hundreds of thousands other buyers/sellers or some no-name coin that has a handful of owners?  

LTC has been crashing against BTC lately.  https://bitcoinwisdom.com/markets/btce/ltcbtc, set it on the 3-day chart.

Sat, 06/14/2014 - 11:32 | 4856547 conscious being
conscious being's picture

If first mover advantage is such an advantage and you are competing with money that's been money for thousands of years, then by your own criteria, you are in a lot of trouble.

Or, you're wrong, first mover head start disipates and all the cc's trend towards a common level of value.

Good luck.

Sat, 06/14/2014 - 21:48 | 4857779 TheHound73
TheHound73's picture

Thanks.  Check back on us Bitcoiners in a year or so and see how your offer of good luck has performed.

Sat, 06/14/2014 - 07:08 | 4856172 jonytk
jonytk's picture

u know nothing, other coins are mostly pump and dump.

Why? well you need to know things about difficulty and mining hardware to completely understand why most of the other coins are insecure and thus worthless.

Took me months to know why, i tried to explain in TL, DR. mode.

Sat, 06/14/2014 - 00:15 | 4855892 NidStyles
NidStyles's picture

Except since there is a dollar price on itt, no one is going to do anything except trade it based on it's dollar value.

You lack of understanding of basic economics is rather obvious.

Sat, 06/14/2014 - 01:06 | 4855932 TheHound73
TheHound73's picture

My 600% YoY thanks you kindly for them there schoolin' lessons.

I have completed contracts and hired labor based on fixed BTC amounts with no reference to the USD exchange rate.  That's only up to the participants to decide between themselves.

6 years ago 0% of the population owned any BTC.  Today I estimate less than 0.1% does.  What's fair value?  Has the market reached saturation?  I don't think it has and BTC can't stand on it's own as a stable unit of account until it has.  For now the USD exchange rate data point is the best we got and generally what merchants are using when they price goods in BTC.  The exchange rate is volatile as fuck and the whole concept is risky as fuck but today, at least, there seems to be a market for it.

Sat, 06/14/2014 - 11:04 | 4856480 TVP
TVP's picture

Someone speaking sense in relation to cryptocurrency on here.  Never thought I'd see the day.

Fri, 06/13/2014 - 23:57 | 4855865 gh0atrider
gh0atrider's picture

Nothing needs to be explained to gh0atrider!

Sat, 06/14/2014 - 00:16 | 4855896 NidStyles
NidStyles's picture

The I shouldn't need to explain how idiotic these arguments are. You are enslaving yourself.

Sat, 06/14/2014 - 09:21 | 4856312 tmosley
tmosley's picture

Strange thing--altcoin prices seem to be completely unaffected by fluctuations in fiat currencies.  They are traded almost entirely in terms of bitcoin.  If something happens with bitcoin (like the Feds threatening to dump their confiscated stash), the bitcoin price of the altcoins is unaffected, even though the dollar price of bitcoin went down 15%.

Sat, 06/14/2014 - 12:40 | 4856317 deflator
deflator's picture

 I really don't see how Greshams law applies here as both currencies are fiat. Saying that bitcoins are, "mined" is an admission of fiat. Why would they say bitcoins are "mined" into existence like gold and silver and not some computer geeky terminology?

When a government changes from silver coins that are worth more than their face value to a base metal coin that is worth less than it's face value yet both coins are redeemable only for their face value. Of course all of the silver coins go out of circulation fairly quickly. Who wants to trade a silver dime that is worth $1.42 in silver value for 10 cents worth of goods and services?

Sat, 06/14/2014 - 11:29 | 4856535 ohcanada
ohcanada's picture

Dr. Benway "Bitcoin is manipulated like a penny stock"

Prove it. Even slightly. I'm fed up of listening to people trash bitcoin. If you dont liek it ignore it, but don't preach  rubbish

Sat, 06/14/2014 - 08:34 | 4856242 sessinpo
sessinpo's picture

Publicus     Simply change your economic activity over to peer to peer currencies that you and other in our peer to peer economic system can print ourselves.

--==--

So I don't trust a cdntral bank and elites as they print to infintiy. And you want me to go to a system where you and others can print? That is ridiculous. It also show you don't understand bitcoin and I am not a supporter of bitcoin because it has all the characteristics of a scam. When I say you don't understand bitcoin, bitcoin is limited in supply, thus you can't print it.

Sat, 06/14/2014 - 08:29 | 4856235 sessinpo
sessinpo's picture

hangemhigh77   BitCoin=Computer Gold

---

My PMs aren't subject to electical distortions such as EMP. Perhaps your bitcoin is more like formica.

Sat, 06/14/2014 - 08:49 | 4856264 TheHound73
TheHound73's picture

What's really cool is that if I want to use Gold as Money on the Internet, all I have to do is powderize a little, stuff it into the end of my ethernet cable then blow really hard. 

Sat, 06/14/2014 - 19:45 | 4857546 crazytechnician
crazytechnician's picture

Nice try , but the problem with that is you do not know where the particles will come out. Plus if there are any leaks in the cables you may lose some or all of it. I would stick with digital , that way you know where it will come out and be assured there are no leaks en-route.

Sat, 06/14/2014 - 09:25 | 4856314 tmosley
tmosley's picture

Gold is for saving, Bitcoin is for transacting.  If there is an EMP, then you won't be transacting very much, so it's no real loss.  Also, when the system comes back up, you will still have your bitcoins.  Every copy of the blockchain would have to be destroyed for your coins to disappear, and that would entail a level of destruction that humanity honestly simply couldn't survive, given that there are so very many backups on every node and most wallets all around the world, doubtlessly including EMP hardened hardware.

Fri, 06/13/2014 - 21:04 | 4855499 Yen Cross
Yen Cross's picture

  BTC is enamoring for it's follower's.

   The risk/reward ratio isn't there yet. That's why there's no "Futures/options" market after 2-3 years. As a smart poster mentioned earlier.

  The time decay/vs the payout is nil.

Fri, 06/13/2014 - 22:27 | 4855731 TheHound73
TheHound73's picture

If you build it they will come.  Many of the big players (BitPay, Coinbase, etc) are screaming for a BTC futures market.

Fri, 06/13/2014 - 22:42 | 4855755 Yen Cross
Yen Cross's picture

 I'm in the understanding/implementation mode.

Sat, 06/14/2014 - 08:36 | 4856245 sessinpo
sessinpo's picture

TheHound73      If you build it they will come.  Many of the big players (BitPay, Coinbase, etc) are screaming for a BTC futures market.

---

Good way to take a scam to the next level. Make derivatives of it. Let's just rehypothicate it. Get the picture?

Sat, 06/14/2014 - 21:53 | 4857786 TheHound73
TheHound73's picture

Anybody who enters into a contract using rehypothicated assets deserves what they get.  A properly functioning futures market does not use rehypothicated assets.  Bitcoin needs futures markets for businesses to offset volitility risk while taking advantage of the transfer savings bitcoin provides.

Fri, 06/13/2014 - 23:11 | 4855796 tmosley
tmosley's picture

"No futures/options market".

If you are going to say things on the internet, you should probably spend two seconds on Google to make sure they stand up to the tiniest bit of scrutiny first.

https://icbit.se/futures

Sat, 06/14/2014 - 00:12 | 4855817 TheHound73
TheHound73's picture

Yeah, well, institutional players will not be using icbit.  Haven't they been shown to be front-running?  We need a better solution.  Peer-to-peer lending on Bitfinex seems to be working well for longs/shorts.  $25 million USD currently lent out on the long side... bitfinex.com/pages/stats

Sat, 06/14/2014 - 02:13 | 4856001 shitco.in
shitco.in's picture

Yes, icbit has been front running their customers for well over a year now.  

There have been other places for futures and other derivitives, but nothing that is as legit as Coinbase yet.  

For BTC and LTC options check out: https://atlasats.com/

Sat, 06/14/2014 - 09:27 | 4856316 tmosley
tmosley's picture

Sorry, I literally only spent two seconds on Google finding one.  I knew there were several out there, if not many.

Fri, 06/13/2014 - 21:05 | 4855504 Silver Shield
Silver Shield's picture

BitCoin is a Ponzi Scheme 3/6/13  http://youtu.be/0UKC7iaBKvs

Confirmed by ZeroHedge 5/26/14 http://www.zerohedge.com/node/488930

Fri, 06/13/2014 - 22:44 | 4855757 no bones
no bones's picture

You're still at it? You should have publicly apologized for the FUD in those videos.

Fri, 06/13/2014 - 23:33 | 4855823 gh0atrider
gh0atrider's picture

He won't appologize he just wants more silver coin sales.

Sun, 06/15/2014 - 05:45 | 4858133 crazytechnician
crazytechnician's picture

He will when he starts accepting bitcoin as a payment option.

Fri, 06/13/2014 - 22:51 | 4855770 stacking12321
stacking12321's picture

chris duane is an egomaniac and a horse's ass.

confirmed every time he speaks.

Sat, 06/14/2014 - 02:14 | 4855984 Haole
Haole's picture

Wow, that takes a lot of nerve after telling people to sell everything they own and buy silver a few years ago.   Then again, selling silver is your business and livelihood after all isn't it, what a coincidence.

Zero Hedge has confirmed nothing of the sort.  One corrupt, now-dead exchange does not Bitcoin make and the more hit pieces ZeroHedge publishes and the louder the BTC-ignorant spit-up on themselves in the comments sections in here, the stronger it has become after being dead how many dozen times now?   Silver Shill is more like it...

Sat, 06/14/2014 - 10:14 | 4856402 SilverSavant
SilverSavant's picture

Anybody, this means you, who badmouths Chris is a fool.  I don't think there are 10 people in the world who have done more for human freedom than He.  He is 100% right about silver.   He just made the same mistake I did, in thinking that there was at least some remaining rule of law in this location that used to be America.

Sat, 06/14/2014 - 14:47 | 4856973 Haole
Haole's picture

Let's see, silver down over 50% from the highs in 3 years, Bitcoin up thousands of percent in the same time frame in terms of real world purchasing power.  Who's the fool again?

The fool is in your bathroom mirror, look no further.  I'm sure the humans who took Chris' advice to any degree a few years ago are delighted to be freed of much of their capital and real purchasing power since.  

Your logic and excuses are absolutely frickin' ridiculous.

 

Sat, 06/14/2014 - 19:47 | 4857549 crazytechnician
crazytechnician's picture

Chris Duane is a fucking idiot. His videos about about bitcoin are full of lies. He has completely discredited himself.

Fri, 06/13/2014 - 21:07 | 4855511 Lumberjack
Lumberjack's picture

On the front lines is this (gorgeous lady)...

 

http://www.duhaimelaw.com/tag/bitcoin/

Fri, 06/13/2014 - 21:08 | 4855516 Spungo
Spungo's picture

Bitcoin on the ceiling was a good song

https://www.youtube.com/watch?v=6yCIDkFI7ew

Fri, 06/13/2014 - 21:08 | 4855519 zerocash
zerocash's picture

Bitcoin = Fonestar p0Rn

Sat, 06/14/2014 - 00:00 | 4855875 gh0atrider
gh0atrider's picture

The memory of fonestar!  He was loved by all of the original posters on ZH (that he helped ban).

Sat, 06/14/2014 - 19:49 | 4857556 crazytechnician
crazytechnician's picture

Some of us are still around. But for how much longer ? The Flat Earth Society fucking hate us lot.

Fri, 06/13/2014 - 21:21 | 4855547 The_Peeper
The_Peeper's picture

The coins just keep tumbin'

Sat, 06/14/2014 - 00:12 | 4855876 gh0atrider
gh0atrider's picture

Money on muh bits and muh bits on muh mind.

Fri, 06/13/2014 - 22:33 | 4855742 stopthejunk1
stopthejunk1's picture

Because NSA has a paper about digital currency, you conclude that BitCoin is NSA?

That's quite a leap.

Fri, 06/13/2014 - 23:13 | 4855802 Bunga Bunga
Bunga Bunga's picture

Why needs the government bitcoins, when they can literally print Dollars?

Sat, 06/14/2014 - 22:39 | 4857866 deflator
deflator's picture

 Governments would love voluntary adoption of virtual currency so they don't have to print anything--even physical paper or bother with the task of producing base metal coins. Governments love nothing better than all of the arguements proposed by bitcoinz proponents.

Sat, 06/14/2014 - 00:02 | 4855878 gh0atrider
gh0atrider's picture

Bitcoin is NSA's worse nightmare.

Sat, 06/14/2014 - 02:46 | 4856019 Rock On Roger
Rock On Roger's picture

Been stacking lately?

Sat, 06/14/2014 - 23:14 | 4857872 deflator
deflator's picture

The NSA is vastly more powerful than the average mofo has a clue. I install access flooring for computer rooms and have installed computer floors at prestigious D.C. area universities where there had to be 5 escorts just to watch me work and their jobs and pensions were on the line if they let me out of their line of sight. I have walked down corridors with award plaques for inventing Kernals that if you Googled the inventors of various internet shit would be some young wealthy person--not some poorly dressed old grey haired snaggle toothed bitch in some old dusty computer room that is 24/7/365 guarded by no less than 5 of the best and the brightest.  I have worked at the white house and cia hq with no escorts. 

 

 If you think you or anyone else is smarter at reading and writing code than what the NSA has cultivated over the past 50 years then you are sadly mistaken. If they are the best and brightest at reading and writing code then the NSA gets them first.

 

 Their sole job is identifying and capturing people with the aptitude of reading and writing code.

Fri, 06/13/2014 - 21:27 | 4855556 TheHound73
TheHound73's picture

Fun fact #51:  Anybody anywhere anytime who has ever owned a bitcoin for 1 year has, at worst, gained 50% on that investment. For today, the appreciation of holding a bitcoin from 1 year previous stands at 600 %.

Fri, 06/13/2014 - 21:28 | 4855561 One of We
One of We's picture

I love bitcoin as a medium of exchange becasue I'm not forced to use it but can if I choose.  I'd rather something tangible was acceptable for "above the counter" transactions but bitcoin doesn't harm me in any way as far as I can tell.

Fri, 06/13/2014 - 21:35 | 4855578 bugs_
bugs_'s picture

dogs don't know its not bacon

Fri, 06/13/2014 - 21:40 | 4855594 QE49er
QE49er's picture

#51 This is going to end very badly

Fri, 06/13/2014 - 21:44 | 4855603 I Write Code
I Write Code's picture

Bitcoin disintermediates the money laundering business so you can be a bankster at home in your pajamas, or on the other side, you can launder money from a tiny table at Starbucks and never physically meet intermediaries wearing diamond nose rings.

Sat, 06/14/2014 - 19:52 | 4857560 crazytechnician
crazytechnician's picture

Says the numbskull who thinks he can crack a 2 ^ 256 SHA private key

Fri, 06/13/2014 - 21:44 | 4855605 sleestak
sleestak's picture

The term "mining bitcoin" should be enough to tell you what's real money.

Sat, 06/14/2014 - 02:38 | 4856016 Rock On Roger
Rock On Roger's picture

And bitcoin is always visualized as a shiny round metal thing.

Fri, 06/13/2014 - 21:48 | 4855613 papa_lazarou
papa_lazarou's picture

It's all about the blockchain, suckers!

The Coming Digital Anarchy

http://www.telegraph.co.uk/technology/news/10881213/The-coming-digital-a...

Fri, 06/13/2014 - 22:40 | 4855751 Yen Cross
Yen Cross's picture

 I'm novice compared to SEEK. I do however pay attention.

Sat, 06/14/2014 - 03:31 | 4856053 DoChenRollingBearing
DoChenRollingBearing's picture

seek is one of the best we have here at ZH.

You too, Yen!  :)

Fri, 06/13/2014 - 22:52 | 4855756 stopthejunk1
stopthejunk1's picture

The thing I love the most about BitCoin is that so many tech ingenues seem to think that somehow it will become mainstream while remaining anonymous, and that all of a sudden, magically, government will just bow out and be like, "Oh well, I guess we can't tax economic activity anymore, because of bitcoin!"

lol!

Really?

How many people do you think will be willing to continue trading in bitcoin if it is made illegal?

And how long do you think it will remain anonymous and untaxable if it is to become mainstream?

I know all about the tech of bitcoin. I have read the papers. I get it. What I don't get is the naiveté of those that seem to think that somehow the powerful cannot control this just like they control everything else, and to the same ends. It's a digital currency, for chrissake. It's not magic.

The claims made by some Bitcoin advocates are simply preposterous. Such as those made in the Telegraph article posted below. As if somehow a credit system based on Bitcoin could not crash? As if somehow, lending practices and the subprime mortgage crisis would have been any different if they were denominated in BTC rather than dollars? As if somehow an economy can operate without the creation of credit?

I haven't seen anyone that is giddy about bitcoin that doesn't seem to have a few screws loose, and to have lost sight of basic facts and reality that fly in the face of any optimism about something like bitcoin. For one thing, the government could shut down bitcoin tomorrow if it felt like it. If it doesn't feel like it, you ought to be asking yourselves why not? Maybe it's not threatened by it after all! Maybe they even *want* you to use Bitcoin! Gee.... why do you think that is? Do you think the government and the rich wants, for the first time in human history, for you to do something that benefits YOU more than it benefits THEM?

Fri, 06/13/2014 - 22:57 | 4855778 stacking12321
stacking12321's picture

i have no problem whatsoever continuing to use bitcoin if "it is made illegal".

and "the powerful" are always behind the curve, they are slow to get their archaic systems to respond, it's like turning the titanic. bitcoin, meanhile, is fast and nimble and on the cutting edge; the network routes around damge, and anything having to do with the government is damage.

Fri, 06/13/2014 - 23:00 | 4855782 TheHound73
TheHound73's picture

You are free to continue on with your current winning strategy in life.

Sat, 06/14/2014 - 09:41 | 4856341 tmosley
tmosley's picture

Yeah, and I'm sure people used to think that something as simple as a rifle in the hands of nearly every person in a country would never get rid of bandits and brigands that once roamed the rural areas of all nations.  But they did.  We forget about how technology changes things on a fundamental level.  Bandits had been a given pretty much everywhere and for all time, outside of towns and cities.  There was a reason trade was so dangerous.  But one little invention changed everything, and now you only see bandit in disarmed nations like Mexico.

"It's not magic."

You're right, it isn't, but you seem to think they are.  Or maybe you think of them as Gods?

A credit system based on Bitcoin wouldn't crash because *GASP* you can't print bitcoins!  Thus you don't get malinvestment, and no small group is in charge of the interest rate.  Instead, the MARKET determines the interest rate.

Bitcoin is an evolutionary step forward from free banking.  Free banking was already nearly a perfect system.  It's only flaw was that each currency was centralized, and as such could be attacked by a government.  Cryptos are non-centralized, and thus CAN'T be attacked by governments.  THey can only attack the choke points where people trade coins for fiat, ie the exchanges.  But you don't have to use exchanges.

"The government could shut down bitcoin tomorrow if it wanted to."

Yeah, by shutting down the internet.  They could also nuke us all if they wanted to.  Both options are stupid and self destructive in an extreme so great that it is tantamount to suicide.  At best they can shut down the exchanges.  That will be a setback, but there will be P2P exchanges set up within a few months, and that would be the end of their influence.

Sorry, I'll let you get back to your central banker worship now.

Sat, 06/14/2014 - 10:52 | 4856355 deflator
deflator's picture

 The government wants adoption of digital currencies over physical paper and base metal coins just like it wanted adoption of base metal coins over silver ones. The difference is profit because even base metals and paper are steadily appreciating against their face value. They wont even have to bother with circulating anything physical like paper and base metal coins. The added value is that all digital transactions can be tracked whereas there is some anonymity in physical paper and base metal transactions.

 

 I'm thinking that if you really wanted to front run the move to digital currencies you would start hoarding base metal coins and paper currencies. In the late 50's early 60's you wouldn't front run the move from silver to base metal coins by hoarding nickel and zinc?

Sat, 06/14/2014 - 14:17 | 4856919 shouldvekilledthem
shouldvekilledthem's picture

@stopthejunk1

A lot of misinformation can be found in this comment. Can you please research the subject before writing nonsense on a public forum (ah sorry I see that we are oon the internets. what have I suspected)?

The most important one is bitcoin's anonimity.

Bitcoin is pseudo-anonymous. You have to take extra steps for complete anonimity.

" I haven't seen anyone that is giddy about bitcoin that doesn't seem to have a few screws loose"

Have you consdiered that normal and crazy is completely objective? Have you considered that from someone else's perspective you're a crazy and dumb idiot?

"It's a digital currency"

You are not completely hopeless though. It's the first (digital) currency which cannot be faked and does not require a central third party to function.
Try to comprehend this first.
 

Sat, 06/14/2014 - 01:54 | 4855785 Bitcoinrealmthai
Bitcoinrealmthai's picture

It is absolutely not true that Thailand "banned Bitcoin outright".   I was directly involved with the initial interface with the Bank of Thailand concerning Bitcoin.  The full CORRECT story may be found at   http://www.bitcoinrealmthai.com/thai-government-regulation-bitcoin-trading/

 

There is now one fully-legal Bitcoin exchange operating in Thailand, at http://www.bitcoin.co.th and there is a second fully-legal exchange coming soon at http://www.coins.co.th

 

My company operates the only directory of Thai businsses that accept payment in Bitcoin - at www.bitcoinrealmthai.com

 

In the big picture, it is not particularly important what goes in in Thailand.  However, when the third sentence of  three-sentence "article" on ZH contains a completely false "fact", it suggests that  all the other information from the same author is likely to contain factual errors.

Fri, 06/13/2014 - 23:12 | 4855800 telefunken
telefunken's picture

Remember Beanie Babies?

Sat, 06/14/2014 - 09:43 | 4856347 tmosley
tmosley's picture

What is the difference between something of limited supply and something of unlimited supply?

If you can't figure it out, you are going to be very, VERY unhappy in a few years at most.

Sat, 06/14/2014 - 22:04 | 4857813 TheHound73
TheHound73's picture

No, but I'm interested.  How many merchants accept Beanie Babies as payment?  Over $30 million in bitcoin were traded yesterday on exchanges.  How does that compare to this Beanie Baby market you speak of?

Fri, 06/13/2014 - 23:13 | 4855801 teslaberry
teslaberry's picture

somehow bitcoiners refuse to accept the fact that without a soveriegn home base that supports their currency  by refusing to allow the police to interfere in commercial transactions ( the united states ) 

 

that any currency is basically doomed to be , at best, a mere barter accounting system. 

 

and here's why.....if people could use a currency on a black market-----it's use then crowds out the use of the soveirgn legal tender and destroys the ability of the government to realize its own purchasing power in its own soveriegn currency. 

 

dollarization is EXACTLY THIS PROCESS. when more venezualans use dollars on the black market than venezualan money, well the venezualan govenrment begins losing control UNLESS IT HAS LOTS OF DOLLARS STOCKED UP. EVEN IF IT DOES, IT CAN NEVER PRINT DOLLARS AS IT CAN ITS OWN CURRENCY SO IT LOSES CONTROL. thus major military government action against its own civilians results to attempot to stop this loss of control. 

bitcoin is similiar in this regard. 

 

if the u.s. govenrmnet ever was threatened by bitcoin they would shut it down. ...ah but you 'cannot shut it down'. 

 

really? so you can have a multi year war on drugs where most are using the MOST ANONYMOUS FORM OF CURRENCY---PHYSICAL EXCHANGE OF PHYSICAL NOTES-----and you don't think the government can shut down peopel 'trading' food and goods in bitcoin?

 

the govenrment doesn't have to kill bitcoin it just has to kill all major banks offering money services in bitcoin and all major providers of any good or service that accept any significant amount of bitcoin. 

this way buying white market goods with bitcoin becomes so expensive, that people owuld rather just use inflated and increasingly worthless dollars. 

this is what the united states already does on foreign soil by dominating other nations and ensuring they trade their goods in dollars. examples petrodollar warfare and central american dollarization

 

thus bitcoin , and non=sovereign cryptocurrency generally have some major issues. people think bitcoin is digital gold. even if it were-----warehouseing and dealing in any meaningful quantity of gold is HIGHLY REGUALTED. 

the whole point of gold is as an insurance policy against hyperinflation which manifests by golds ability to just sit in your house doing nothing forever while a small fraction of physically traded gold changed hands at any other place in the world. 

bitcoin does not yet have this staying power as a traditional hedge against inflation, because it --the bitcoin network----has not yet proved itself as resistant to attack by government. 

bitcoin's value in it relation to the existence of a network of active transactions all the time is still highly dubious. if the payment network were to see a massive and sustained drop in volume. bitcoin could fall deeply out of favor for quite some time while another crypto currency network eclipses it in some other country or even in the u.s. 

unlike gold, new cryptocurrency networks can pop up almost costlessly to the ISSUER . just because bitcoin is limited in the amount that exist doesn't mean cryptocurrency as a class is. in fact, that very weakness of bitcoin, is the best argument for the enduring and highly promising future of black market future of cryptocurrency as a whole.

it does however look like bitcoin now has wings, and that the average volume on a daily basis should be steadily increasing for years to come. regardless of price swings, the average daily volume is the measure of the success of the currency, and by any measure its growing!

go bitcoin!

Sat, 06/14/2014 - 01:49 | 4855900 TheHound73
TheHound73's picture

> "the govenrment doesn't have to kill bitcoin it just has to kill all major banks offering money services in bitcoin and all major providers of any good or service that accept any significant amount of bitcoin. "

 

In the meantime, The U.S. government is selling 29,656.5130529 legally unencumbered bitcoins at the end of this month.  A historical first. http://www.usmarshals.gov/assets/2014/bitcoins/

Sat, 06/14/2014 - 07:17 | 4856182 jonytk
jonytk's picture

that's why it's called trustless, you with a phone wallet on a starbucks are now a bank and a sell gold store all in one.

Fri, 06/13/2014 - 23:46 | 4855842 One And Only
One And Only's picture

Thailand banned it?

I just bought 100 units of a product from Thailand with bitcoin...literally 5 minutes ago.

Sat, 06/14/2014 - 00:15 | 4855893 Karaio
Karaio's picture

Bitcoin may work today but have no security.
Cash or good value is the one you see changing hands.
Any lack of energy and all you have is going to shit.
No, I will not go that fucking not!
hehe.

Sat, 06/14/2014 - 03:27 | 4856045 stacking12321
stacking12321's picture

engrish, prease?

Sat, 06/14/2014 - 05:46 | 4856118 shouldvekilledthem
shouldvekilledthem's picture

I think you have a misconception of how bitcoin works. Only a complete apocalypse can kill it. Everything else is merely a disruption which can all be overcome and continue operation.

Mon, 06/16/2014 - 00:36 | 4860297 teslaberry
teslaberry's picture

this is how insane bitcoin people are. you think a temporary distruption of the world wide internet is a 'complete apocolaypse' . 

 

the net is only 30 years old. the history of major wars and disruption events, far larger. 

 

the tell tale sign is people try to argue bitcoin is superior to the dollar. they don't think, what about sovereign fiat in general and private bank notes ?

bitcoin is a private distributed bank not backed by nothing other than the effectiveness and superiority of the payment system itself. 

if that effectiveness and superiorirty is not maintained-----it is total shit compared to other cryptocurrency attempts in the future. 

 

Sat, 06/14/2014 - 00:28 | 4855913 Yen Cross
Yen Cross's picture

 In an algo &(#@_(&) way, I can see the potential for abuse.

Sat, 06/14/2014 - 00:31 | 4855914 TruthTalker
TruthTalker's picture

What if there is an EMP strike  - then what - gold you have and can use - Bitcoin disappears.  hat if the government shuts down the internet?  What if your account is hacked?  These questions make bitcoin not something I would ever invest my fiat paper in.  Bitcoin 5 years - gold 5000k  - think I'll stick with gold

 

By the way they say when not if we have one   https://www.youtube.com/watch?v=wVLIJDXNXoo&feature=youtu.be

Sat, 06/14/2014 - 01:39 | 4855969 TheHound73
TheHound73's picture

It's not for everybody.  You are among the 99.9% of the population that currently does not own any bitcoin.

Sat, 06/14/2014 - 02:15 | 4856002 mijev
mijev's picture

If we lose power and the internet, how are you going to tell if the gold youre trading is real? It will also make sharing youtube videos a little difficult. 

Sat, 06/14/2014 - 02:17 | 4856005 Matt
Matt's picture

"What if there is an EMP strike?"

WW3 and end of days. Or at the least, starvation, riots, spent fuel pond meltdowns. Buying stuff is going to be pretty low priority if that happens. In the long run, hopefully you backed up your wallet and then just load it up somewhere that was not hit by the EMP.

"What if the government shuts down the internet?"

What if the government rounds people up and puts them into concentration camps? What if the government confiscates your gold, your home, all of your assets?

Sat, 06/14/2014 - 05:43 | 4856115 shouldvekilledthem
shouldvekilledthem's picture

When your country gets bombed, gold won't take you too far either. Food, water, shelter and weapons will be the most valuable assets ;-)

The internet is the most efficient way of transferring information so it's evident that the restoration of electricity/internet will be high priority after a fallout. 

Consdiering that the blockchain (the "essence" of bitcoin) is stored everywhere on the planet it will be very easy to restore it and continue normal operation.

The best way for bitcoin to be stored long term is in physical form anyways. It's called a "paper wallet", but you can save your private key on any material really (even with encryption!).

The internet and services running on it (like bitcoin) paves the way for a better society. If we lose these completely then there'll be more important issues on our minds than money.

Sat, 06/14/2014 - 04:39 | 4856095 shouldvekilledthem
shouldvekilledthem's picture

Wake up peasants! bitcoin is the answer to the ponzi fiat we are forced to use. :)

Sat, 06/14/2014 - 05:15 | 4856105 danster82
danster82's picture

One way to get bitcoin and invest at the same time would be a mining fund such as https://www.havelockinvestments.com/fund.php?symbol=PETA You get a good return plus mined bitcoins into your chosen wallet.

Sat, 06/14/2014 - 07:33 | 4856196 shitco.in
shitco.in's picture

Hopefully you are good at maths and are using the right formulas and assumptions when calculating your ROI with difficulty increases.  

Ps: AM has 60PH of hardware hitting the network soon: https://bitcointalk.org/index.php?topic=99497.msg7147330#msg7147330

Sat, 06/14/2014 - 08:02 | 4856218 Formula382
Formula382's picture

I have many issues with Bitcoin as a currency, one being that it requires electricity to function.  That's just one of many however, as I think in all, though there are some qualities, it still has too many flaws.  

Sat, 06/14/2014 - 08:23 | 4856228 kowalli
kowalli's picture

Guys you just don't understand that if they can print money like federal reserve why can't they do the same with bitcoin,but it's a way easier to do. Why Bitcoin was set main cryptocurrency of a sudden, even though they all evolved equally? I think because it is in this embodiment, a portion of currency protection laws can be circumvented or simply do not have. It's like a card system, but even more simple for cheating people.

And none of you - can't prove that my way of thinking is not right

Sat, 06/14/2014 - 08:42 | 4856255 sessinpo
sessinpo's picture

I still wonder why these bitcoin companies take your fiat currency in trade for services or product.

Sat, 06/14/2014 - 10:38 | 4856445 Fix It Again Timmy
Fix It Again Timmy's picture

Bitcoin totally is dependent on an electrical supply grid that is anything but bulletproof; having said that, when the grid goes - we're back in the 1700s and bitcoins will be the least of your worries....

Sat, 06/14/2014 - 20:04 | 4857577 crazytechnician
crazytechnician's picture

If the power grid goes down proper - we will be going back a lot further than 1700 , try a couple of million years at least. All complex life will be wiped out from failed cooling systems on power plants spent fuel rod ponds. ELE.

Sat, 06/14/2014 - 11:47 | 4856587 truth serum
truth serum's picture

OK boys & girls......here is the "skinny" on bitcoin:

It has NO INTRINSIC VALUE, therefor it is only as good as the NEXT GREATER FOOL is willing to pay.  It should be called a 

Kleptocurrency (as in theft).  It defys the laws of thermodynamics.....as in something can't come from nothing.


Sat, 06/14/2014 - 12:29 | 4856620 deflator
deflator's picture

 Confidence has intrinsic value according to central bankers. I suspect that governments and central bankers haven't forced a strict digital currency system yet for fear of losing the confidence angle.

 

 A strict digital for physical transaction system is no doubt the wave of the future--just not how the bitcoinz crowd is imagining. For now, governments and CB's are happy that people are willingly and not so gradually moving to all digital transactions such as direct deposits, card swipes, etc.

Sat, 06/14/2014 - 20:05 | 4857579 crazytechnician
crazytechnician's picture

Our entire universe came out of nothing.

Sat, 06/14/2014 - 22:05 | 4857762 TheHound73
TheHound73's picture

OK boys & girls..... What does using the terms "intrinsic" and "value" together in a sentence tell us about the intelligence of the speaker?

Sat, 06/14/2014 - 13:33 | 4856809 SilverIsMoney
SilverIsMoney's picture

Of all the stupid things bitcoiners say I think the one that irks me the most is, "THEY ARE POWERLESS TO STOP IT!" If you think that you are such a fucking fool I do not know what to tell you.

 

"They" currently rig every fucking price on the planet but you think your crypto currency that's been easily hacked, watched it's largest exchanges fail, and price go from 1 penny to 10$ to $1200 to $400 to $650 all within the last year cannot be rigged or influenced (especially as even the announcement from the FBI that they're going to sell a fraction of the bitcoins ever mined crashes the price nearly $100) then you really haven't been paying any attention.

 

I'm actually really starting to come around on bitcoin and I'm going to probably buy more (I bought 1 at $30 and have just sat on it) but this idea "they" can't stop it is just so beyond fucking stupid.

 

Like i've said from the beginning all it takes is a government/bank/largecorporation to introduce a more secure crypto and all these free market ones will go to shit. I strongly suspect bitcoin will end up worthless as it's essientially a beta for the future of crypto currencies but I have determined there's enough fucktards out there willing to buy them at any price that I can probably make a cool amount of profit that can be easily turned into more Gold and Silver thanks to Peter Schiff and Amagi Metals. Cryptos in the short run, PMs for the long...

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