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Does anyone here use Bitcoins?
wraith808:
An investment is only as good as the ways that you can capitalize on it. Until then, it's speculation IMO.
40hz:
^40, I'm not sure what you mean by "the outcome is predictable". -tomos (March 22, 2013, 01:15 PM)
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It will either implode (likely), be outlawed and shut down (quite likely), or (much less likely) forced into the existing financial framework in much the same way that Paypal was as a vanilla payment service. What it will not be allowed to remain is an "investment opportunity." Or as a system with the potential to easily facilitate the transfer of funds for things deemed to be 'illegal.' Legally (or extra-legally if necessary) it simply won't be allowed to continue. Period.
According to that article it's given bitcoin credibility:
The value of a bitcoin rose to more than $60 a unit from less than $49 on one exchange following the release of FinCen's new guidance—a move that Mr. Garzik attributed partly to a new level of certainty and legitimacy that federal recognition attaches to bitcoin transactions.
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I think it more accurate to characterize it as giving Bitcoin the spotlight rather than credibility. The simple fact its valuation is zooming up so rapidly is a positive indication (to me at any rate) that the arbitragers, always out to make a quick buck, have scented an opportunity (i.e. money + publicity + amateur investors) and are starting to move in on it. If I'm correct, bitcoins will continue their rapid rate climb for a few more months before it all tanks when the pros suddenly cash out en masse.
And lets not forget there is federal recognition - and then there's FEDERAL RECOGNITION - as in "subject of interest" in an government investigation or probe. In this case, the 'recognition' is that the feds see this as a potential problem just starting to show up on their SONAR and which they are now in the process of computing a "shooting solution" for.
Re spending it:
why would anyone want to spend it when the price is inflating so much -
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They wouldn't. Which can cause major problems for an economy and therefor why speculation in domestic currency is illegal in many countries. Hording cash has negative consequences across the board in most instances.
which means of course that it's pretty useless as an active currency - but good as an investment (for the moment anyways).
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Which is an interesting switch in much of the argument for having Bitcoins. Originally it was meant to be an alternative currency. Now, most of it's admirers seem to prefer to see it as on investment opportunity. However, what it is actually an investment in raises some interesting questions. There doesn't seem to be much of anything behind a bitcoin other than the cash originally paid - and a bunch of people somehow mutually agreeing it's magically worth more than that. Which then raises the question of how its value can be increasing so rapidly above the value of the hard money paid in to create it originally. How and where is there any value being added? By demand? Ok. But if so, demand for what? A demand for a higher value based on the demand it be...valued higher?
It's circular logic... :huh:
And if so, that's not investing. It's pure speculation. More along the lines of having the brass kahunas to raise on a busted flush in a poker game with the hope your opponent folds first. So if these bitcoin "investors" aren't very careful, this whole thing could easily turn into something much like a Ponzi scheme, with those first in (and first to cash out) being the big beneficiaries, while everybody else is left holding a bag full of worthless bits in some database.
Dunno. This whole thing strikes me as being more like the brief US Pog fad a few years back then anything else. For awhile that was the big "in thing" with collectors touting the "incredible value" and rapid price appreciation of their collections. Then, once the kids started getting into, it the prices for "collectible" Pogs really took off. It wasn't long before Pog collectors even had their own magazine.
It took less than a year or so before people woke up and asked: "Why exactly did I spend $10 last week to buy this little round piece of printed cardboard?" That usually happened right about the time they tried to sell their collection and discovered it was suddenly worthless - which coincided very neatly with the fact that the little kiosk at their local shopping mall (which had been doing such a brisk trade selling Pogs the month before) was now gone...
tomos:
wraith & 40 - thanks for calling me out on using the 'investment' term :up:
Yes, 'speculation' is correct.
I'm not a fan of bitcoin in any real way, but I'm deadly curious to see what does happen with it. I agree with lots of what you're saying 40. As I said above, as an active currency it's a fail. That could change if it survives.
But ironically, a lot of what you say about it applies to 'regular' money too (the 'circular logic'). In this day and age, that fact that they say the production of bitcoins will be limited is enough to get people excited - there's a lot of fear around about 'real' money production since banks have become less and less regulated and not held responsible for their cockups.
40hz:
But ironically, a lot of what you say about it applies to 'regular' money too (the 'circular logic').
-tomos (March 22, 2013, 05:05 PM)
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It very much does. But people are used to it - and are more willing to tolerate the problem they're familiar with than take a chance on having to deal with a new one.
When the US redesigned it's currency not too long ago, the original idea was to use color and a completely new look. IMO, the mockups for some of the new bills were absolutely gorgeous.
But they were all trashed and a design for somewhat ugly green bills that more closely resembled the previous design were chosen instead. Because the government worried that the American people wouldn't like them being so different. And then might possibly wonder why they were being changed at all - and maybe then start asking some potentially disruptive questions that could lead to them losing faith in their currency...
The solution? Don't rock the boat too hard. Put as many anti-counterfeiting features into the new design as possible while making it look as much like the old currency as possible. End of problem after some very minor griping on the part of the public.
This is the mindset Bitcoin is going to go up against if it wants to become a currency in its own right. Overcoming the memes that say: Only nations and governments can issue legitimate currency. Anything other than a national currency is a Mastercard. And anything 'new' is bad when it comes to money.
;) 8)
ewemoa:
I'm just seriously interested in where you can use botcoins for non-geek types of products and services.
-40hz (March 22, 2013, 11:38 AM)
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Once we all start using botnets to do things, I think you have your answer ;)
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