I follow Andreas Antonopolous regularly because I haven't found any more knowledge and inspiring speakers.
https://www.youtube.com/watch?v=3mUcpsbnhGE
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I follow Andreas Antonopolous regularly because I haven't found any more knowledge and inspiring speakers.
https://www.youtube.com/watch?v=3mUcpsbnhGE
I see Bitcoin distinguished itself as the worst-performing currency of 2014.
http://www.bloombergview.com/article...ncy-wasbitcoin
Yes, treating Bitcoin, the currency, as an investment, because its market cap, is like investing a penny stock: volatile. But that doesn't mean much. Mostly, people don't carry a currency like the U.S. dollar to make a profit, they use it because its accepted and they can get goods and services with them. That is, one doesn't want dollars because one thinks it will outperform the Euro next year. The price of Bitcoin is a distraction because it is in its infancy.Quote:
Originally Posted by LDAHL
Venture capitalist investing in the underlying block chain technology however is increasing dramatically which demonstrates the value of the technology as the future of money:
V.C. investment 2012: 2.10 million
2013: 93.84 million
2014: 314.73 million YTD
http://www.coindesk.com/bitcoin-venture-capital/
Infrastructure is being created all over the world at a dizzying rate. Job creation in the field is growing at a similar clip comparable to the capital investment rate. Dell, Amazon, CVS, Paypal, Subway, Overstock.com, Target, Ebay are just some of the big names now accepting it.
I agree that losing 56% of the value of your account in a year would be very distracting.Quote:
Originally Posted by Xmac
Apart from a few currency specialists, people carry the dollar and instruments denominated in dollars because they believe the dollar will hold its value better than the alternatives until they’re ready to spend it. Bitcoin performed miserably in that respect.
As far as the future of money goes, I see three issues. The technology itself could prove more vulnerable to interference than the evangelists are proclaiming. The level of Bitcoin-related fraud seems higher than a reasonable trader would want to risk. Finally, if it were to become an annoyance to national governments, they could simply abrogate contracts denominated in bitcoins the way the U.S. abrogated contracts denominated in gold back in the thirties.
The dollar is my functional currency. For me to use a currency other than the dollar I need to have a motivation- access to goods or services not available in dollars, gain/hedge, etc.Quote:
Originally Posted by Xmac
Is there a reason to consider using bitcoins other than novelty? I don't see a motivation other than speculation.
That emoticon above did not come from me.
No idea how it got in there. ???
Just like stocks, you only lost if you realized losses by selling.Quote:
Originally Posted by LDAHL
Yes, it's reasonable in the immediate future and those in the Weimar Republic, Argentina and most recently in Cypress had similar beliefs, among them being, 'my money is safe (or best)'. How many know that the dollar has lost almost one percent spending power per year over the last hundred years?Quote:
Apart from a few currency specialists, people carry the dollar and instruments denominated in dollars because they believe the dollar will hold its value better than the alternatives until they’re ready to spend it.
Market gyrations in price are not its value, otherwise V.C.s wouldn't be pouring hundreds of millions of dollars into it. But, if one is a speculative stock investor, one understands that there are wide swings in price and they invest for the long term as part of a diversified portfolio. This technique is very lucrative and high risk given a one year time horizon. Most responsible advocates of Bitcoin don't recommend it. Notice that the title of my post is the FUTURE of money. I'm not espousing that amateur investors make larges purchases of Bitcoin for short term gains...its a red herring argument that distracts from the real innovation.Quote:
Bitcoin performed miserably in that respect.
.Quote:
As far as the future of money goes, I see three issues. The technology itself could prove more vulnerable to interference than the evangelists are proclaiming.
How safe is your credit card number? How about the value of your dollars as BRICS aggressively moves from it and the Fed expands money supply with QE? Think bail-ins can't happen here? Besides, anyone can say such and such is possible, but is it likely is the real question. If you're saying it is probable what is that based on?
What fraud is that? I've bought it, used it, held it. I control the security. If I let someone else do it, like Mt.Gox for example, then I'm at risk because I gave my private keys to a third party like people do with banks.Quote:
The level of Bitcoin-related fraud seems higher than a reasonable trader would want to risk.
It doesn't sound like you watched the video.Quote:
Finally, if it were to become an annoyance to national governments, they could simply abrogate contracts denominated in bitcoins the way the U.S. abrogated contracts denominated in gold back in the thirties.
By the time banks with government names (Federal Reserve) figure out what to do about cryptocurrencies, it will be too late because this is a global (not just U.S.) electronic currency as content type and stopping information from propagating on the internet is about as plausible as it was stopping shortwave radio code propagation during WWII.
In the West, we have the least need to use Bitcoin at the moment, unless you're a foreigner sending money home by remittance which is costly. There are, however, billions of people in underdeveloped countries who have no access to banking who could use it and are starting.Quote:
Originally Posted by Yossarian
I gave my son twenty-five bucks worth and told him to hold on to it for a while and maybe add to it here and there, maybe five bucks once in a while. If he finds out Subway takes it, it may not last though.
If one has money they know they won't need for at least three years, I'd invest one to five percent of my disposable income in it. Why, because it has become increasingly stable and the long term outlook is favorable for growth. People have already bought expensive homes, businesses, cars, etc., with this currency. There is a Bitcoin ATM in the halls of Congress! It's not going anywhere if people keep using it, no matter what "authorities" and hackers do. They'll only make it more resilient. You can't undo an idea that is spreading like wildfire.
Will this currency lead to: fairly valuing natural capital and natural resources, the soils ability to regenerate, the value of the oceans ecosystem, the value of a stable climate, the undiscounted value of the future etc.. Will it lead to: valuing durability, efficiency, rather than the wastefulness that is gdp, valuing that which increases human well being, not which is made necessary by detracting from it? Will it lead to valuing: all the unmonetized social capital that makes up life, all the unpaid labor that makes everything else possible? Will it lead to valuing individuals for thier own sake as more than just economic machinery? Valuing human potential where it is wasted? Valuing peace over war? Valuing cooperation?
Utopian? Well yes if one expects it out of whole cloth and for the world to be entirely perfect. That's not the point. The point is: so much of what is destructive these days is driven by money. And people have done a lot of thinking on currency and human values (Thomas Greco, Bernard Lietaer) and how currency could be used to value and encourage all that is valuable, and I think that's the desirable direction to head in.
There are a number of independent local currencies that basically head in that direction, ANM, individual human time, goods and services represented by an exchangeable certificate. I think when things get too global, what was a fair means of exchange becomes too nebulous and open to speculation, which ... basically negates any honest valuation of what a unit of the currency represents. It's a conundrum; local money will probably remain honest but it's impractical, global money becomes a casino currency favoring the lucky, the amoral and the rich.
Quote:
Originally Posted by ApatheticNoMore
I am sure this is well intended but I find it hard to see the point of it all. Currency is just an exchange medium. It doesn't matter if it is dollars or cattle or seashells or gold or whatever, all that matters is that people agree to use it. It is necessarily amoral and exponentially more useful the more people agree to use the same medium, which is contrary to creating illiquid local substitutes. What's the point of measuring "individual human time, goods and services represented by an exchangeable certificate" when you can do the exact same thing with dollars or Euros, only better? Currency is just a tool that solves the problems of scale and transferability in barter. No conundrums at all.Quote:
Originally Posted by kib
Now how you manage it to provide a secure store of value is also important, but that's a different kettle of fish.
Every few years my community investigates setting up a local currency.
The arguments advanced in favor of the use of "local currency" tend to be:
- it keeps money circulating within our community, instead of having it leak out to the mainland/mainstream economy so rapidly.
- it encourages production and consumption of local goods
- it encourages use of our fallow local resources, especially labor
- it provides an easy method of implementing price discrimination to fleece tourists while charging locals a sane amount for goods
- it facilitates non-IRS/non state Department-of-Revenue transactions :-)
The folks on a nice island in Canada right next to us have been doing this for ~15 years or so:
http://www.saltspringdollars.com/
http://en.wikipedia.org/wiki/Local_currency
The thing is, the number of dollars, euros etc. are not at all limited by the creation of actual wealth. They are directly tied to debt-based value creation. Tying certificates or coins or dollars or pet gerbils to an actual asset, whether tangible goods or intangible services, is the different kettle of fish that ideally presents a non-debt-based, possibly inflation-proof local economy.Quote:
Originally Posted by Yossarian
In re bitcoin, bitcoin is not limiting itself to real asset backing, as far as I know, and so I see no reason why it would turn out any differently than other global currency, except that it's playing with a different set of rules and so, for the time being, favoring a different set of players.
I have a suggestion: use a valuable metal, such as copper bars for your medium of exchange. Stamp the weight on them, and the name of your Island, and a serial number. Yes, they may weigh something, but it will be okay. Anything else, with no intrinsic value, could be considered counterfeiting.
There is a misconception that money needs to be a store of tangible value. This country had a successful fiat system before the Revolutionary War for a long time because it was responsibly controlled in relationship to goods and services, no inflation and no boom busts (which do not occur naturally in healthy economies). Its value was usage level and trust in the issuer(s).
Kib is exactly right, Yossarian, about the currency being used today. We haven't had substance redeemable currency for many decades. But, we don't have just simple fiat either. We are using debt instruments as dollars. All dollars are created out of a demand for debt, as debt and the interest owed is not created with which to pay back that debt (read Modern Money Mechanics issued by the Federal Reserve). This means that most fiat currencies are Ponzi schemes that slowly decrease spending power. It is a profit system for banks and explains a lot. So, what is used as money matters a lot.
The value in Bitcoin is that it is frictionless currency: no third party interlopers and near instant transferability with a level of encryption that used on nuclear silos. There is also incredible value in the block chain itself which is open source consensus of all transactions of any type.
There is no such thing as "intrinsic" value. What is abundantly available and needed has no value, even if it is food. That which is limited/scarce and desired is what gives a thing value. Bitcoin has that feature also. It is deflationary.
What determines value is not a government or old ideas of value about things like gold. Value is determined by demand/scarcity and a currency is determined by the level of usage, no matter what any one says.
In Kenya a currency evolved out of cell phone minutes because the people saw its utilitarian value. It now accounts for 40% of the Kenyan GDP. Bitcoin also has amazing utilitarian value far beyond a currency. Currency is just the first app.
Quote:
Originally Posted by ApatheticNoMore
Absolutely, no to all of the above. No currency that is conditional give and take will. Some currencies are closer than other though.
Your questions are very important, thanks.
Right, Bitcoin is not Utopian, except maybe in contrast to what we have now.Quote:
Utopian? Well yes if one expects it out of whole cloth and for the world to be entirely perfect. That's not the point. The point is: so much of what is destructive these days is driven by money. And people have done a lot of thinking on currency and human values (Thomas Greco, Bernard Lietaer) and how currency could be used to value and encourage all that is valuable, and I think that's the desirable direction to head in.
Huh? No Copper, No Sail Fones.
Sorry, but I feel you folks are zig zagging all over the place.
So have we moved on from the whole values based currency to a discussion of value based currency? The relationship between the money supply and economic growth is a known, if not fully understood issue. But I don't think bitcoin or barter certificates are the answer.Quote:
Originally Posted by kib
Yes, that is my point. So far most people are willing to hold dollars or euros because the convention is steady and supply and demand have been roughly equal. The real value of what I can exchange my dollars for when I defer my purchase and hold dollars over time is acceptable. The dollar stores the value of my labor generated at time A and lets me buy goods or services later at time B at acceptable levels. What's not to like? I don't see how you can promote a currency that doesn't store value.Quote:
Originally Posted by Xmac
There is a risk that could change in the future. None of this convinces me local exchange certificates or bitcoin will solve the worlds problems.
I guess for me, the problem with world currency is that money which grows exponentially through debt is dangerous. The "wealth" through debt creation scheme rigs itself so obviously in favor of the rich, whether we're talking individuals or countries, and so much worse for those on the bottom. It also encourages the rape of the planet as the increasingly poor have less and less leverage about protecting the planet's assets essential for long term stability. IMHO, the more money is created purely as a matter of real resources or time expenditure, the more checks and balances exist. I don't know that local currencies are the answer, but a revamp that doesn't include debt-based wealth creation is crucial.
I read what you are saying, but I can't follow what you mean. How does the money supply do any of that? If you could waive your magic wand and cut the number of dollars in existence by 95%, what effect would that have on anything?Quote:
Originally Posted by kib
Acceptance and adoption. As acceptance grows, price or exchange value levels out. The world has never had currency issued by algorithm before. Do you think gold has always been accepted? Someone thousands of years ago decided it was valuable and then others agreed until agreement became widespread adoption was achieved. That process is now beginning with cryptocurrencies.Quote:
Originally Posted by Yossarian
We have a currency system that is designed to create levels of scarcity that encourages the individual to think only about their own well being. It works well. As kib so eloquently pointed out there are many problems the state issued fiat system creates that are not immediately visible to individuals who don't look. It's also designed to fail and that failure is close.
Countries are beginning to hoard gold, BRICS are moving away from the U.S. dollar, China has taken action to help Russia in a move that was heretofore done by the institutions of Bretton Woods. We are going to need a system in place to facilitate world trade that is not predatory, unsustainable and encouraging of environmental degradation.
There is a bigger risk: that it won't change.Quote:
There is a risk that could change in the future.
Understanding the technology and the current system is what it takes and those who do are putting hundreds of millions of dollars behind that understanding.Quote:
None of this convinces me local exchange certificates or bitcoin will solve the worlds problems.
I think this thread is in contention for using the most words without actually saying anything. Just vaugue disparaging criticisms without specifics. All you are proposing is moving from one arbitrary medium to another. Yes other countries would like to move away from the dollar standard but they are not benevolent rainbow crusaders, it's pure economic self interest.Quote:
Originally Posted by Xmac
I don't want to miss an opportunity to make things better. Seriously, if bitcoin is the ticket then I'll buy some tomorrow. But it will take more than plattitudes. So let's try breaking this into pieces- in your own words, how will bitcoin create a system that will save the environment?
What does "invest" constitute in this context? What form would the investment take? What yield would you project over the next 5 years? What's the risk?Quote:
Originally Posted by Xmac
I have no idea. :)Quote:
Originally Posted by Yossarian
I do agree with Xmac's assertion that our current monetary system is predatory, and that this predation / greed can easily overlook the planet's needs as something superfluous in comparison to the bottom line, when in reality, the planet's needs ARE the bottom line. I do not understand enough about bitcoin to know how / if it mitigates predation by attempting to divide power / wealth more evenly, by maintaining a value more closely based on real-world assets and effort as opposed to speculation or debt-based 'value'. That seems like a step in the right direction to me, so if that is the direction of bitcoin, I see the benefit. It is certainly the direction of local currency trends.
What does that mean?Quote:
Originally Posted by kib
What are "the planet's needs"?Quote:
... the planet's needs ARE the bottom line.
http://www.investing.com/currencies/btc-usd-technicalQuote:
Originally Posted by bae
Our current system is a system using non-substance redeemable fiat currency that is debt based. It is issued by an unconstitutional entity: The Federal Reserve which is an association of private banks, not in any way part of the government. It is as Federal as Federal Express and it has no legitimate reserves of its own.
The "money" supply is expanded over time that destroys purchasing power. When Federal Reserve Notes (not dollars) are used to extinguish a debt, it creates a novation. Which is using a debt to pay another debt.
This system also makes the U.S. government a debtor to which taxpayers are the surety. According the government's own Grace Commission, established by R. Reagan, every tax dollar sent to the I.R.S. does NOT go to the government for services, it goes to pay the national debt which is owed to a group of private bankers (the Fed) who bring no consideration to any loan, only the usurped power to create money.
So, all your Federal taxes are diverted and spending power eroded. Get the predatory bit yet?
As I referenced earlier, money creation is in the Federal Reserves own literature, Modern Money Mechanics among other places. The truth right under our noses.
I don't have any inclination to go into how this system and its predatory lending has been exported all over the world. The U.S. has more than enough verifiable evidence.
I view technical analysis as "homeopathy for investing". So, not such a useful link.Quote:
Originally Posted by Xmac
Looks like by "investing in bitcoin" you mean simply purchasing bitcoin?
Quote:
Originally Posted by Xmac
Ah. The usual anti-Fed conspiracy-theory quackery. Got it.
http://rationalwiki.org/wiki/Federal...ed_crankery.3F
Did I suggest otherwise? Btw, they ARE moving from the dollar, in that they signed an agreement for such.Quote:
Originally Posted by Yossarian
Quote:
I don't want to miss an opportunity to make things better. Seriously, if bitcoin is the ticket then I'll buy some tomorrow. But it will take more than plattitudes. So let's try breaking this into pieces- in your own words, how will bitcoin create a system that will save the environment?
Crowdfunding using Bitcoin, and other cryptocurrencies are already happening to create viable, sustainable alternative energy and other technologies that clean the environment. As adoption grows, funding will grow because people will continue to donate when they know it can be done directly and it is in their own long term self interest.
http://crowdfundbeat.com/2013/07/08/...mental-change/
Rationalwiki?Quote:
Originally Posted by bae
Really?
They're being investigated by the FBI.
Well, if you don't read the Fed's own documents......what can anyone tell you? Not much, seemingly.
:laff:Quote:
Originally Posted by bae
Yes, dollar cost averaging in over a five year time horizon would yield comparable returns to that of other similar speculative ventures. This is why it would be only part of a diversified portfolio.Quote:
Looks like by "investing in bitcoin" you mean simply purchasing bitcoin?
The ecosystem can't survive forever with the amount of tampering-for-profit that's going on. One by one the strands of the life web are being broken as we dam, strip mine, frack, burn fossil fuels, monocrop, create dioxin and myriad other "interferences" with the delicate cycles that support life on earth. If we go beyond a certain point of degradation, WE, as living animals, cannot survive; the health of the planet is what allows us to exist at all. 'The planet's need' is to have its living infrastructure left intact, and we seem perilously close to dismantling it.Quote:
Originally Posted by bae
The greater the financial entity, the greater its ability to tamper with that infrastructure in the name of profit. Poison a lake? Oh well the fine's only 10 million dollars, pay it, Jeeves. Smaller economic entities don't have the luxury of such devastation. While the whole "for profit" concept is a problem for the planet in the end, it is at least diluted when the power base is divided.
As far as predatory, I'm using the word to mean competitive in a way that shuts out smaller entities which might be less damaging. I see a firm connection between Big and Broken, and if a currency backed by real assets can in some way reallocate wealth across a broader base without simply taking from the rich and giving to the poor, well good deal.
And I'll say it again, what -if anything- this has to do with bitcoin is admittedly vague in my mind.
Hmm, so if we were using bitcoins, the fine's only 32,000 bitcoins, pay it, Jeeves.Quote:
Originally Posted by kib
Not sure that would solve a lot. Maybe you shoud use Lira, at least then it would be 16 billion. Maybe that sounds more detering.
Bitcoin doesn't single handedly stop the greed that causes humans to destroy the environment but it introduces a currency that can displace a system that encourages it.Quote:
Originally Posted by Yossarian
A business, for example, like fracking is highly leveraged. Other industries that are less so still get their start up capital mainly from loans. Without loan contracts many damaging businesses wouldn't get started or continue. Bitcoin doesn't prohibit loans, however it does prohibit the creation of money out of thin air, which is what the current system does for every loan made in the system.
The unbridled money expansion over the last hundred years is a major contributing factor of unbridled consumption ergo environmental degradation.
For those that find this incredulous, you may try googleing fractional reserve lending, as well as doing the other suggested reading in this thread. Fractional (another kind of fracking) reserve lending is allowable by LAW....again, look it up. Don't take my word for it. It is there.
Deep down everyone knows that this banking system doesn't lend money it has because there has NEVER been a bank that refuses to lend money to a qualified borrower for lack of current available funds.
It's not unlike the typical wealthy man who convinces himself his young mistress or call girl is really in love with him. It's a seductive and/or comfortable little fantasy but that's all it is.
How does bitcoin distinguish between damaging businesses you want to repress and helpful businesses you want to promote?Quote:
Originally Posted by Xmac
Your best argument for bitcoin is that it will depress the economy?
I'm doing a deal this week to sell an early childhood education facility its campus, at long last, so it can stop paying rent to its evil capitalist landlord (me). Part of the deal involves a...loan.Quote:
Originally Posted by Yossarian
I guess Bitcoin Society would be better served if I bulldozed the place and started a pig farm.
It will stunt some sectors and stimulate it in others. For example, there are literally billions of people who'll experience booming economic growth because their economic potential has been under utilized due to political and financial corruption (homegrown and imported) especially in third world countries. Bitcoin's velocity and accessibility will be very valuable features in those areas as its acceptance grows.Quote:
Originally Posted by Yossarian
The international remittance market is where this is already occurring. Big predatory companies like Western Union are seeing increasing amounts of market share disappear while those in third world countries are starting to get ALL of the wealth that is being earned by their family members abroad.
In the U.S., where vast wealth is made available to large corporations who have track records of stripping the earth of resources, there would no longer be loan creation from the top down, which is how it is made available now (e.g. from a Central bank to Citi to Shell), and no/less political cover via lobbyists who influence laws favoring such. This would create a level playing field for the competition: companies that offer sustainable energy and use renewable resources.
In Germany, and in other European countries, sustainable energy is flourishing. Oil companies here have a tight hold on policy and monopolize energy. In fact, they have so much control even before lower gas prices, shale and fracking companies were already losing money, i.e. for every dollar made on oil extraction, they spent 1.30, unsustainable financially and environmentally. But, they've been able to continue with financing through junk bonds, and heavy profiteering especially when oil was above $100 a barrel.
The above assumes a world that is ultimately dominated by a cyrptocurrency very similar to Bitcoin, only with some advances in accessibility. How we get there will be interesting to say the least.
There are others that could more cohesively make the case than I, but I understand enough to know that the root problem that Bitcoin can address is the debt based money system (the primary root problem which can't be addressed by any currency or technology is the love of money which is what created the current system).
So, long term, Bitcoin has the potential to even out some or all of the imbalances in the world economy because it is not debt based or centralized. It is money/value by agreement to use math that is open source.
There's an old expression that says there's nothing new under the sun, which may be true even for Bitcoin/cryptocurrencies but I don't see any precedent for it, not on a global scale anyway.
Feel free to ignore this part of his post.Quote:
Originally Posted by Xmac
I think the point Xmas was trying to make is that with a more stable amount of currency there is not money being over-created and sloshing around the economy being maki vested in bad investments. Good investments like a school buying their formerly rented property will always find money available to be borrowed for such purpose (assuming, of course, that the school does actually have a reasonable likelihood of being able to repay the loan.). When unlimited quantities of money can be created, as with fractional reserve banking, malinvestment bubbles, like the recent real estate bubble and subsequent crash, are inevitable.
Quote:
Originally Posted by bae
There is a substantial difference between loans in which valid consideration is exchanged and loans in which money itself is created.
Here's your education if you can stand it:
https://www.youtube.com/watch?v=qIxhsF6JLEA
https://www.youtube.com/watch?v=p3_Q1SiRN-A
What is the "correct" amount of currency to be in the economy?Quote:
Originally Posted by jp1