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[CoinDesk] Bitcoin debit card iBTCard will offer lower processing fees for merchants - Page 5

post #41 of 46
Quote:
Originally Posted by airbozo View Post

The problem I see with bitcoins is that there is no backing. There also seem to be no stability.

Those two problems exist only because it's so new. This makes its future uncertain. There are obvious risks involved in btc today. That is undeniable.

But backing and stability will naturally improve, as worldwide acceptance increases.
It will be backed by the entire economic market that accepts and trades it, and as long as said economy is large enough, then it will become stable. At least as stable as any other currency.
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post #42 of 46
Quote:
Originally Posted by airbozo View Post

To be honest, if someone tried to pay me in bitcoins I would laugh in their face, because it would be akin to paying me with Monopoly money. That is going to be a huge hurdle to leap. Bitcoins will not become a widely traded currency until there are regulations (something bitcoins were invented to avoid), and backing (not sure this will be possible). Admittedly I am not that knowledgeable about bitcoins, but I don't see the need to understand them better since I highly doubt they will become a legitimate currency any time soon, if ever so take my comments accordingly.

Before commenting and stating an opinion on any given topic, you should try to educate yourself a little about said topic.
I recommend reading my post here. I think I explain pretty well what bitcoin brings to the table, and why it is so important for everybody that it reaches mainstream adoption.

I also like this http://www.youtube.com/watch?v=NNaPHevENIg. That was about a month ago. Those guys are obviously biased, but they are correct in everything they say.
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post #43 of 46
This thread has ventured WAY off topic, but I still can't resist pointing out the forex fallacies being tossed around in this thread. Physical money not based upon a valued physical commodity, *has no actual physical value.* Read that again and let it sink in. Good to go? Great, let's continue. Dollar bills are made of a mixture of cotton and wood fiber pulp, and rest assured that the contents of a dollar bill are not worth a dollar. Conversely, the copper content in pennies made before 1986 (I believe that is the correct year, may be wrong) is worth far more than one cent at current market prices. Physical currencies such as the dollar and euro simply imply *intrinsic value*. This is to say that when one possesses a hundred dollar bill, they have a general idea of the physical goods they can expect to receive in exchange for the bill. This is all fine and well until the intrinsic value becomes highly volatile, as in times of extreme inflation or deflation of a currency's value. This is why forex traders can make a killing in a couple of opportunistic days, and it is why you hear cries from the Tea Party camp/Ron Paul calling for a return to the Gold Standard, when the dollar's value was essentially directly tied to the value of gold (simplistic statement, but in the end true.) So, how does this compare to crypto currencies such as Bitcoin? Obviously Bitcoin has numerous differences compared to physical currencies "backed" by entities such as the federal government, but three major differences in the etiologies of the respective currencies exist, and exemplify Bitcoin's rapid adoption where other alternative currencies have failed. Where as dollars are basically printed ad hoc, Bitcoins are "mined"; they are slowly generated via P2P verification transactions utilizing complex algorithms. Bitcoins are also capped; there is an absolute finite amount that can "exist". Lastly, Bitcoins are largely free from outside governmental regulation and market manipulation. These three features alone indicate that Bitcoins will only continue to rise in value, but again, this is dependent upon society's evaluation of their intrinsic value. This isn't to say that Bitcoins *WILL* rise in value and *WILL* become a widely accepted alternative currency, only that the conditions are there for this to happen. As for the argument that an entity such as Google could simply create their own currency and market it to the top, this is incomplete thinking. Google is a multi-national mega corporation that is primarily based in the U.S. Last time I checked, corporations have to play ball with government regulations in order to do business, and you better believe the government would want to regulate the bejeezus out of a corporately sponsored currency. The approval process, rules, and oversight would likely be onerous. Aside from this, crypto currencies are inherently designed to avoid profit taking via manipulation. Why would a corporation go to the trouble to found and market their own crypto currency, when the potential profit they could reap from it would undoubtedly be less than current national currencies? Finally, yes, crypto currencies somewhat resemble a ponzi scheme, but so do most intrinsic value based currencies nowadays, so what's the beef there? Why do you think the Euro gained so much value since its inception, while the Canadian dollar has remained relatively stagnant during the same time? Hmmmm......
Edited by btupsx - 7/31/13 at 1:35pm
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post #44 of 46
Quote:
Originally Posted by fateswarm View Post

I personally understand the reality that does give it value, an actual value. What I actually argue for is that I don't think it can ever 'make it' without imploding under its own nature: A big player that sees benefit in it can easily duplicate it and make a better advertising campaign for his version. So it can't succeed without failing and it can't avoid failing without not succeeding much.

Also, the faith of governments on money, is an actual value. You can't just dismiss it as worthless. You may hate governments but that doesn't negate the fact that they give actual value to it. They simply support you using it. The tell you this thing you hold is valuable. They have power and power strengthens the value of things it supports.

I'm not saying that currency backed by faith in the government is a bad thing or makes their currency worthless. I'm saying that if we can accept a currency that is utterly useless by itself (though useful when used as a medium of exchange) that is backed by the faith of the government, then it's not completely absurd to accept an equally useless currency that has had value placed on it simply by the will of people. In either case, we have an example of something that is valuable because it is valuable.
Quote:
Originally Posted by lacrossewacker View Post

you guys are missing the point.

We don't dig for dollar bills.

Our currency is used as a place holder basically, it's value was derived from somewhere. That value was earned through working hours, selling a service, or selling a product.

Where does the value come from with bitcoins? My $30 dollars can represent quite a bit. It could from the hour of work I've done, from a good meal I prepared somebody, or a simply mowing somebody's yard.

Those $30 dollars weren't just magically found and given value. Even money you find in the street, it came from somewhere. From somebody that worked for it, or from somebody that sold something for it.

Digging for petroleum is worth money because the petroleum itself is valuable to our society. That value is represented by our currency. So a $100 dollar bill is probably worth like a penny in materials, but it's representative of the sweat and work that was put into earning that bill.

How does mining for bitcoins fit into this? What are you mining, how is is valuable, and how does it earn it? Saying its rare is crap. I can say each of my boogers is rare.....doesn't suddenly make it a $200 gem. Bitcoins aren't a raw material, they aren't a usable product or service, they aren't exotic diamonds, they're just some weird scheme that's been cooking up on the internet.


Without calling me an ignorant idiot for not understanding the entire picture, what am I missing?

From what I understand, bitcoin "mining" is just a method of bitcoins entering circulation, and once they're obtained they are free for users to do with them whatever they wish. If society actually did start to take them seriously, you could spend them or receive them for services and products, in the same way that you could spend or receive dollars or euros. They, as with many items, are only as valuable as people say they are.

For example, you use the example that "your boogers" are not worth $200, but if society determined that they were, then they would be. That's all it would take. It's a rather silly example that you chose to use and obviously that wouldn't happen, but even your overly silly and nonsensical example is possible in theory.
post #45 of 46
Quote:
Originally Posted by btupsx View Post

This isn't to say that Bitcoins *WILL* rise in value and *WILL* become a widely accepted alternative currency, only that the conditions are there for this to happen.

Well said. Important to be aware. Even the biggest bitcoin supports know that its not a sure thing. Nobody is making that claim. But it certainly seems to have pretty good odds of success.

Quote:
Finally, yes, crypto currencies somewhat resemble a ponzi scheme, but so do most intrinsic value based currencies nowadays, so what's the beef there?
I've never heard anyone say that. And I don't see the connection... There's no resemblance there at all.

But since you brought it up, something else to be aware of: The Federal Reserve bank's sole operation is a government protected ponzi scheme. When anyone else does it, they go to jail. But when the Federal Reserve (a PRIVATELY OWNED corporation) does it, it's okay. That's just one of the reason's why bitcoin is important for the future, to give people a choice to be free.
Edited by wedge - 7/31/13 at 1:47pm
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post #46 of 46
Quote:
Originally Posted by Mike395 View Post

From what I understand, bitcoin "mining" is just a method of bitcoins entering circulation,

False.

The "mining" process, is actually the backbone of the network. It is used to introduce new coins. But that is not its purpose.
The distributed network that is created by the miners is what maintains the security, and processes the transactions that occur. Because it is an enormous distributed p2p network, that makes it impossible for any entity to control bitcoin. Every user has complete power over their own coins, nobody can take those away, or prevent them from being spent. That is made possible by the network. The network IS bitcoin. Bitcoin IS the network.
Edited by wedge - 7/31/13 at 1:53pm
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