wachtwoord

Why is "Bitcoin replacing gold" a forgone conclusion? Yes I get that there is ease of transfer, but you are saying that even if it's not used as currency, it will replace gold. But as someone else pointed out in this thread, gold has been ingrained in our civilization for thousands of years, and holds the confidence as a store of value for the vast majority of people around the world. So I think it's flawed to say as if Bitcoin should be $300,000, just because it's better than gold. And I wouldn't even say it's better than gold. Gold has other uses besides store of value and currency, bitcoin doesn't. If the whole system breaks down, or if the Government puts restrictions on the use of bitcoins, the ease of transfer doesn't work anymore; and then it doesn't have that advantage over gold. Gold you can store in your house, sew in your garments. As someone else pointed out, the government is not going to be able to check every single household. Everyone knows gold. Everyone knows it's valuable. It's shiny and pretty. It has the "share of mind" that Buffett talks about. Bitcoin doesn't have any of these qualities. Please read the source I linked to, than you'll agree Bitcoin is better than gold. It's simply because it implements the properties (scarce, fungible, uniform, transportable, have a high value-to-weight ratio, are easily identifiable, are highly durable, and their supplies are relatively steady and predictable) better than PMs. To respond to your last point: Bitcoin is also easier to store "in your house" with less chances of confiscation. If someone looks through your house they'll find you gold storage much easier to however you stored your private keys. Add to that that private keys can be encrypted. Crypto is taking over, simply because it's better :) What if the government says bitcoin transactions are illegal? Maybe they can't confiscate it, but they can shut down its use. Or what if shit hits the fan and the internet doesn't work tomorrow, and all we have is here and now? Also I added an edit to my previous post. Nation states can technically make anything illegal they wish. It'll be difficult to uphold the law though (and will have unexpected side effects such as the rise of the US maffia because of th prohibition). Also, the US has made gold illegal in the past. That has had no long term influence whatsoever. I personally believe the revolution will happen faster if they do fight it so I actually don't mind if they do. I agree with your edit and have never held any PMs for this very reason (I do hold stocks). PMs are just an inflation hedge, nothing more. The reason I do hold Bitcoin is that I believe its extremely undervalued. Once the revolution is done, it will have taken PMs place and I'll likely use it for the cash portion of my portfolio only. If you hold and ounce of gold (or a Bitcoin) for 100 years it's still an ounce of gold (or 1 Bitcoin).

You are completly missing the point here. Volatility is a problem because it directly interferes with practical use. You think google would have succeeded if they randomly decided to take down their server every other day? We would all be using bing now. You cant compare the value of a currency with a freaking stock price lol. They are 2 different things. People ddidt have to use google stock to pay for stuff for google to be succesfull. And i claim overvalued because of this: https://blockchain.info/nl/charts/n-transactions Before anyone besides some hackers and online drugbuyers had ever heard of bitcoin, transactions were pretty much the same as they are now. And no you cant just exclude popular adresses. With 2 periods of big exposure this year, almost no one is using it to pay for stuff. Another thing to prove my point is that bitpay only had 100 million$ in transactions. This may look like alot but consider this chart: https://blockchain.info/nl/charts/estimated-transaction-volume-usd?timespan=1year&showDataPoints=false&daysAverageString=1&show_header=true&scale=0&address= 100 million$ in volume is literally 4 easy days in july. Or maybe 5 days in january. So if it was like 2 or 3 billion, that would actually show adoption. But everyone i just buying to hoard, and no one buys to pay for stuff. And with 15k merchants accepting it and all the coverage, there is really no excuse for that. My prediction is that this wont become any better next year. Gold has been very successful throughout history but must have been very volatile at the start. So volatility is moot. Transaction volume is a very weak proxy to determine the amount of sales (at the very least right now possibly ever). This includes every transaction, so also me shuffling my coins in my own wallets as part of general bookkeeping, but also moving them to exchanges to sell or trade them (which causes the huge peaks in the graph on the 3 times in history Bitcoin price has risen super-exponentially) and gambling games. The gambling games create a single transaction for every bet made (not just for depositing and withdrawing). It's unfair to use this to determine general purchasing volume as such a purchase only produces 1 transaction in the blockchain. (oh and btw: I'd use this smoothed graphs myself so: https://blockchain.info/nl/charts/n-transactions?timespan=all&showDataPoints=false&daysAverageString=7&show_header=true&scale=1&address= and https://blockchain.info/nl/charts/estimated-transaction-volume-usd?showDataPoints=false&show_header=true&daysAverageString=7&timespan=all&scale=1&address= ) The sales volume of Bitpay is a much better proxy and still low indeed. It did grow substantially. In the end, Bitcoin is greatly undervalued even if no-one will ever use it as a currency (which isn't true today) because merely replacing gold requires a valuation of $300,000 per Bitcoin. And as you may recall: Bitcoin is better than gold http://evoorhees.blogspot.nl/2012/04/bitcoin-libertarian-introduction.html ) Anyway, I really doubt we'll come to agreement (see how I just repeated and summarized my argument that volatility is fine?). Let's just let time decide who's right, but we both made the points we wanted to make, now others can do their own due diligence if this sparked their interest :)

Like what? The USD? :D Merchants need to have far higher merchants to account for losses due to chargebacks. Credit card companies take huge fees. Do you really believe the small cash back you get is higher than what you would save if the middle man was taken out? I don't think you understand the business model of credit card companies. Me too. I only know one other person with a brokerage account and when exchanging money to go on holiday it's not like I can withdraw foreign currency from IB. Add to that the fact that a fiat withdrawal in Euro's will cost me ~20 Euros. Banking fees are huge and are much lower when using Bitcoin, not to mention much faster. An most importantly, no-one can block you. I don't like a third party deciding what I do with my money. Banks have blocked transfers of mine in the past. First they accused me of having a virus but when I kept complaining I got someone higher up and she admitted the bank just didn't want me to transfer money where I wanted to transfer money. The fact that the money was mine didn't seem like a valid argument to them. This was ING Bank btw. So buy 1 BTC if you think that's enough. $1M might be a long way out though :)

I responded to the volatility and explained why it's not a problem. Volatility for an investment isn't important, we just require a stronger rate of return. Further extreme volatility is to be expected in something that is as grossly undervalued as Bitcoin and will balance out as the market cap grows. I'm sure the same thing happened to gold when it was first discovered. With our current fast paced society the fluctuations just go a hell of a lot faster :) You claimed overvaluation because it went up fast and then down by ~50% in a few days and I claimed that's not what defines overvaluation. I can't provide a truly accurate valuation besides WAY WAY higher than today. People have done this in the past and continue to do so. This: http://bitcoin-valuation.org/fair-value-bitcoin-28823/ is an example and this ignores most of the uses of Bitcoin and also forgets to inflate the money supply to account for 20 years of inflation. The thing is, if you believe it's overvalued today you must be pretty sure the value is very close to zero as the market cap today is just way too low as a currency. Even if Bitcoin would only replace gold (and Bitcoin is better than gold) the value would be >$300k per Bitcoin given the current market cap of gold. This can be your opinion (that the whole idea behind crypto and probably gold even does not appeal to you at all) but then say so and at least offer the common Keynsian arguments instead of the non-arguments your offering now. You see, I don't think our discussion is very productive in the way we're doing it now :)

I can't see a one. But to be fair I'll respond to your entire post now. Bitcoin is massively undervalued, so it's not a bubble. It might go down a lot from here still though. That does not make it a bubble. I definitely would not mind being paid in Bitcoin. Although I'd prefer the be paid multiple times per month then to Dollar cost average a little better :) It's more secure than any other store of value I ever used or seen. The decentralization is the thing that makes it secure (so if you start using a centralized approach you know where you've gone wrong). The security is in your own hands, so as a highly educated IT professional I can tell you I have decent security ;) Don't know how to do that yourself and need it? Hire me or someone like me. That's because volatility isn't a problem. If you start something from scratch is going to be volatile. What do you think the prices of any huge ass company of today would look like in the first years after its inception (Think MSFT or GOOG for instance). That's just the way it goes when 1. something truly valuable starts from scratch and 2. The value is actually being expanded as you go. The more massive something is undervalued to more massive the price fluctuations. again your kinda ignoring my points really. First bitcoin is massively overvalued. If you say it is undervalued then you dont understand what the fundamental value of bitcoin is. When it was 30$ it had the same amount of daily transactions at 1k$. It means people arent really using it much to pay for stuff, but mostly to speculate and day trade. So hence its massively overvalued. Everyone is hoarding it, and that is why the price is so high now. Even most bitcoin fanatics agree with this. Bitpay had like 100 million$ of transactions total now. Given its daily volume, and given the fact iv seen a bunch of merchants basicly saying that barely anyone uses it to pay for stuff, it means people dont really use it yet. And at some point everyone is going to look around and realize, everyone is speculating, and nobody is using this for stuff! And then the price will crash to like 20$ again. And second, the whole point is that if it is volatile and risky to use, people wont use it. And so it will not stop being volatile. You need widespread adoption to stop this. You basicly said, naaah google was volatile as well. But that comparison is completly ridicilous because google's value could be volatile, because it didnt get in the way of its use. And really you want to be paid in bitcoins?? What if you have to pay rent. You get paid when they are worth 1k$. And now they are at 600$ and you have to pay your living expenses from a salary that is worth almost 50% less. Im not sure anyone but gamblers want to get paid like this. So again, because I think you dont understand this, most regular people dont like to use bitcoin, because it doesnt really offer a big advantage, and you could lose like 30% before you get to pay for your stuff. And if you just keep dollars in a bitstamp account or something, and pay with those, then why the hell use them in the first place? Why not use paypal. Does exactly the same. And it is actually free to use. And finally alot of bitcoin's usefullness is really only because banks are still inefficient in certain areas. If it really becomes a thread, they can just band together and become more efficient. But yeah i guess these problems will just magically take care of it self. You're just reiterating your previous points without really reading my responses. I could do the same but that wouldn't really be valuable :) If your this sure Bitcoin is overvalued I'd direct you to https://www.bitfinex.com/ to short sell Bitcoin and put your money where your mouth is.

I really think a basket method is the best way to go about this. No one knows what is going to happen, except for maybe Satoshi, the Winklevii, and the FBI (since they hold so much of DPR's money :P). Who would have thought Dogecoin and Deutsche eMark (I love these names!) would have rocketed up yesterday? You're not going to see possible 100x growth in just Bitcoin. $60k a coin where you have to worry about them being stolen? Not to mention that the average American is notoriously bad with decimal places to actually split that up and spend it right. I haven't even heard people talking about Ripple, which is near a $2B market cap and where they did the complete opposite of BTC as far as I can tell and made all the coins and are now selling em'. It's #2 ahead of LTC. If you want to speculate that's fine. Dogecoin will go nowhere it's a Bitcoin clone and Deutsche eMark is a PPCoin clone. If you're going to speculate don't do it basket style as you'll lose guaranteed. You'll need to cherry pick the pump and dumps that will work. Good luck, I think the luck factor is even larger than when doing the same with penny stocks. I'd advice to stick with the real thing or invest in altcoins that at least vary on the original concept. Even LTC (different hashing algorithm) and PPCoin (Proof of Stake) are only minor variations and these variations can be included in Bitcoin if this is needed. So even LTC and PPCoin have very limited chances of success. If an alt-coin is ever created which revolutionizes crypto-currencies in a way that Bitcoin cannot adopt it, by all means jump on it as soon as possible.

Why would you think this? Are you going to hold onto all your possessions until your death if I guarantee they'll rise in value @ a steady 2% APR indefinitely? Of course not, you want to use and enjoy your "money", for that is the only purpose to pursue wealth in the first place.

Worlds Within the Margin you seem to miss the point so much it's probably impossible to explain it to you. Therefore I'll ignore most of your rant but I'll offer these 2 points: 1. Tulips aren't unlimited in amount and tulips spoil. I have no idea why anyone would compare Bitcoin to that except utter ignorance. 2. There are companies who pay their employees in Bitcoin. The first one is Finish I believe and recently I remember seeing this: http://www.coindesk.com/polish-web-design-company-pays-salaries-bitcoin/ in the news. I hope you educate yourself better :)

Yup because these are centralized (egold was the most famous I believe). In 2009 Satoshi Nakamoto made a revolutionary new approach which makes all this feasible.

Haha, that's what most people think and in reality it will prove to be completely opposite. The more the existing system fights Bitcoin, the stronger it will get. If you fight it by limiting the functionality of your own money (fiat) your only crippling fiat even more giving Bitcoin a larger benefit. The ban on gold by the US also killed gold right? Oh wait, it didn't :) Disclaimer: Note that the above is my opinion. I don't think it's likely I'm wrong, but stranger things have happened ;)

How? The government has, what, 1.6 billion rounds of ammo? Are they really going to let a new 1% exist that got there by putting $100 in these a few years ago? Power is much more complex than just how paper wealthy someone is. Didn't Margaret Thatcher once say that if she could choose absolute political power or the power of being able to issue currency she's choose the latter because that's more powerful? Full (or nigh full) adoption of Bitcoin will take that power away from governments.

Because it takes power away from central banks and governments.

It can provide a number of functions. The most important being store of value (if you read the Voorhees' articles I linked to you can read why I regard Bitcoin as superior to gold), currency (means of exchange) and remittance. The main advantage above fiat currency is that it cannot be inflated away. Next to that it's really important that you are able to control your own money. With fiat the only way to control your own money is by using cash. If you want to do it electronically you need a bank account and for that you need to lend your money to a third party entity we know as banks. Banks can do all sorts of nasty things such charging high fees, being slow, blocking transactions and in the worst of cases: lose your money. With Bitcoin you control your own funds which makes it cheaper, faster and most importantly constantly in your own control. I'm not sure what will happen when the society breaks down and I doubt anyone does. If I would regard that a realistic possibility I would relocate and stockpile on many other things such as guns, ammunition, long lasting food and water, matches, toilet paper etc.

This is my gripe with bitcoin's value in the long-term. There is value in having an inflationary monetary system where the levels of inflation can somewhat be controlled. Yes there are abuses...of course. But IMHO those potential abuses are (1) less harmful than the problems of not having those levers to pull in times of need, and (2) less harmful than the deflationary nature of how bitcoin is currently set up (with a fixed amount). Even gold isn't a totally fixed supply. This is the popular (Keynesian) viewpoint. I'm a contrarian and think the Keynesian view of economy is utterly and completely wrong. The centralist (regulated) approach will always be inferior to the distributed (free market) approach for matters as complex as the global economy. Most of the world does not agree with me so take your pick :)

27

The X-files showed us that the only way to get piece on Earth is for all people to die. Please don't wish for that! ;) I guess then we'll need a strict definition of war first ;) The only example I know outside of human behavior is wars between ant hills. That wouldn't quite do it either. Lions would still kill antelope and sharks would still kill seals, lobsters would still eat their young, etc.

Thanks. Selling shovels I see :) Are you doing pretty well with this? Not especially. I've done it once and the guy approached me (because I'm an long time member of the Bitcoin forums and 'seemed intelligent'). It kind of fun and easy to do as all I'm basically doing is explaining my own setup (which is secure), why it works and talking him through setting it up in the same way (he's also asking general Bitcoin questions to understand it better). The guy is very satisfied :) Absolutely agree. It's sort of sickening to be honest. The combined computing power of bitcoin is more than 256 times that of the largest 500 supercomputers combined. It's things like this that remind me why we don't have flying cars. We'd rather foam at the mouth when an iPad is released with 128GB than actually make anything useful. I'm going to be blunt, that's absolute bullshit. It's not wasteful it's for securing the network. What do you think the sum of financial institutions complete with ATMs cost? What do you think the computer networks of VISA and AMEX costs? What do you think the entire network of WU costs? Let me tell you Bitcoin's approach is not only cheaper it's also real security instead of the false security the other institutions offer (a bank can transfer funds from your account without your consent). The computing power needs to go up a bit further to make it completely financially unviable to attack it even for superpowers (USA/China). Not tha i's possible to profitable attack it today, but at a huge loss it's still feasible.

The X-files showed us that the only way to get piece on Earth is for all people to die. Please don't wish for that! ;)

Warm weather :)

I think Churchill sums it up best: Many forms of Government have been tried and will be tried in this world of sin and woe. No one pretends that democracy is perfect or all-wise. Indeed, it has been said that democracy is the worst form of government except all those other forms that have been tried from time to time. I disagree. Even many dictatorships have outperformed democracy. At least democracy as we define it nowadays with an equal voting right for everyone. I think that's one of the most naive and stupid things ever envisioned by humans.

I'm going to focus on another aspect totally ignored. The wealth tax. See: http://online.wsj.com/news/articles/SB10001424052702304355104579232480552517224?mod=WSJ_hpp_sections_opinion I think the people in charge are probably retarded enough to actually do this (then again they might not). I'm interested to hear other viewpoints :)

Have fun: http://icbit.se/futures I know nothing about futures so dumb question: Wouldn't those exposure me to unlimited losses if bitcoin skyrocketed? I'm pretty sure it uses margin and auto-liquidation.

Oh you ain't seen nothing yet. Bitcoin can be much much more volatile than this and has in the past. Still an excellent store of value though. Oh, and the Winkeloss twins have made an ETF out of their 1% holding and are in the process of getting it approved.

Hahaha, thanks so recognizable :)

Have fun: http://icbit.se/futures