Should I buy Bitcoins?

12 years ago

Yes - Western Governments are printing trillions as we speak which will cause inflation in the future. Bitcoin is a safe bet. Get involved or wish you had!

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NoobSensei

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12 years ago

Originally Posted by Big Energy

Yes - Western Governments are printing trillions as we speak which will cause inflation in the future. Bitcoin is a safe bet. Get involved or wish you had!

In the past year, the value of the bitcoin has fluctuated by 2300%. In that same period of time the US Dollar has lost 1.1% of its value, and the Euro has lost 1.6% of its value. Bitcoins are hardly a stable source of value, especially compared to national currencies.
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12 years ago

Originally Posted by Big Energy

Yes - Western Governments are printing trillions as we speak which will cause inflation in the future. Bitcoin is a safe bet.

It doesn't actually cause inflation. It causes prices to rise. This is different.

Imagine that you have two million dollars in the world, that two million dollars is backed by two thousand ounces of gold (we are not on the gold standard anymore, but let's pretend), and a whole chicken costs $10 or 1/100 of an ounce of gold.

If the government prints up another $18 million and there's now twenty million dollars backed by the same 2,000 ounces of gold, a whole chicken soon costs $100 - or 1/100 of an ounce of gold.

Meanwhile, if you live in the UK, and there are (say) a million pounds sterling backed by a million pounds of silver (imagine that) which are worth the same as America's 2,000 ounces of gold (just for the sake of argument)... that chicken costs £5 both before and after America prints up all that money, because £1 = a pound of silver = 1/500 of an ounce of gold and that chicken is still worth 1/100 of an ounce of gold = 5/500 ounces = £5.

HOWEVER. Before all that money was printed, you could only buy $2 for £1 on the forex markets. Now you can buy $20 for £1. So if there's reason to believe America will increase their gold reserves (or their GNP, which is what really backs a fiat currency like we actually use now that the gold standard is history) in the near future, you could make a buttload of money buying US dollars between now and then.

MEANWHILE, the people we see urging investment in Bitcoin would be screaming from the rooftops that £1 sterling is now worth ten times as many US dollars so now is the time to be buying the hell out of it on the forex markets because look at how the value is skyrocketing.

If you do not understand what I just explained, do not invest in Bitcoin or indeed in anything whatsoever. Especially on the forex markets. And stop listening to those people telling you where the big investments are.

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"The Golden Town is the Golden Town no longer. They have sold their pillars for brass and their temples for money, they have made coins out of their golden doors. It is become a dark town full of trouble, there is no ease in its streets, beauty has left it and the old songs are gone." - Lord Dunsany, The Messengers

12 years ago

Originally Posted by CDarklock

It doesn't actually cause inflation. It causes prices to rise. This is different.

Imagine that you have two million dollars in the world, that two million dollars is backed by two thousand ounces of gold (we are not on the gold standard anymore, but let's pretend), and a whole chicken costs $10 or 1/100 of an ounce of gold.

If the government prints up another $18 million and there's now twenty million dollars backed by the same 2,000 ounces of gold, a whole chicken soon costs $100 - or 1/100 of an ounce of gold.

Meanwhile, if you live in the UK, and there are (say) a million pounds sterling backed by a million pounds of silver (imagine that) which are worth the same as America's 2,000 ounces of gold (just for the sake of argument)... that chicken costs £5 both before and after America prints up all that money, because £1 = a pound of silver = 1/500 of an ounce of gold and that chicken is still worth 1/100 of an ounce of gold = 5/500 ounces = £5.

HOWEVER. Before all that money was printed, you could only buy $2 for £1 on the forex markets. Now you can buy $20 for £1. So if there's reason to believe America will increase their gold reserves (or their GNP, which is what really backs a fiat currency like we actually use now that the gold standard is history) in the near future, you could make a buttload of money buying US dollars between now and then.

MEANWHILE, the people we see urging investment in Bitcoin would be screaming from the rooftops that £1 sterling is now worth ten times as many US dollars so now is the time to be buying the hell out of it on the forex markets because look at how the value is skyrocketing.

If you do not understand what I just explained, do not invest in Bitcoin or indeed in anything whatsoever. Especially on the forex markets. And stop listening to those people telling you where the big investments are.

The GNP is the US may not really increase in any real way. The US used to be an independent POWERHOUSE! TODAY, it is dependent, and a shadow of itself. Look at how jobs are being replaced! Engineering and manufacturng is being outsourced. Even DOMESTIC jobs that are here to say are being outsourced DOMESTICALLY. I should know, since I am one of the relative few that is involved with that and a natural born citizen.

MEANWHILE, we are SELLING and providing service, mostly DOMESTICALLY!

So we are moving from an INTERNATIONAL INDEPENDENT model that DEMANDS the dollar has value to one that is SEMINATIONAL and DEPENDENT that demands NOTHING!

DON'T be fooled though! It will SEEM to increase maybe 20% a year, FI WE ARE LUCKY, but that will be due to INFLATION! If it stayed static, it would be a REDUCTION! The SAME is true for JOBS! The NUMBER MUST increase to keep the percentage the SAME because of the increased number of workers due to fertility and immigration.

Steve

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CDarklock

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12 years ago

Originally Posted by seasoned

The GNP is the US blah blah blah I don't actually understand the difference between reality and rhetoric

Which is why I said "if" in the first place, in this completely fictional and dramatically oversimplified example of how money and international economies work.
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"The Golden Town is the Golden Town no longer. They have sold their pillars for brass and their temples for money, they have made coins out of their golden doors. It is become a dark town full of trouble, there is no ease in its streets, beauty has left it and the old songs are gone." - Lord Dunsany, The Messengers

12 years ago

Depends. The general consensus is Bitcoins have value for executing transactions: sending money is nearly free, there's no chance of getting your account closed, signing up is nearly instantaneous, you can't block someone sending money to someone else.

If capital controls of any sort get put in place (keeping you from sending money outside the US because the government goes bankrupt, like happened in Cyprus) expect Bitcoin to get extremely popular all of a sudden.

If you think the chances of that happening are extremely low, it's probably a poor investment. If you think people will start finding Bitcoin real useful in the future, buying is probably a smart thing to do.

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12 years ago

Originally Posted by andreas3

Depends. The general consensus is Bitcoins have value for executing transactions: sending money is nearly free, there's no chance of getting your account closed, signing up is nearly instantaneous, you can't block someone sending money to someone else.

WHY are you saying that? To the extent that that is true of bitcons, it is true for dollars, and nearly any other currency!

If capital controls of any sort get put in place (keeping you from sending money outside the US because the government goes bankrupt, like happened in Cyprus) expect Bitcoin to get extremely popular all of a sudden.

Wat for MY response to THIS!

If you think the chances of that happening are extremely low, it's probably a poor investment. If you think people will start finding Bitcoin real useful in the future, buying is probably a smart thing to do.

Due to the OBVIOUS counterfeiting. I call it counterfeiting anyway! SAME concept! YEAH, they are legit coins, but legit coins obtained for NOTHING! It is like making the perfect counterfeit dollar! Shades of "who's minding the mint"!!!!!!

Who's Minding the Mint? (1967) - IMDb

AND, due to the *******ADMITTED******* phony arbitrage done by a bitcoin exchange, I would say it works out to being a SCAM!

Steve

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12 years ago

Due to the OBVIOUS counterfeiting. I call it counterfeiting anyway! SAME concept! YEAH, they are legit coins, but legit coins obtained for NOTHING! It is like making the perfect counterfeit dollar! Shades of "who's minding the mint"!!!!!!

You're very wrong here. Bitcoins actually cost quite a bit to create.

First of all, any computer can make them, so you need to invest in a computer.

However, if you want to make Bitcoins quickly, then you need a hardcore server that can handle the huge amount of information required to make newer Bitcoins (they are only getting harder).

Now, let's consider how much power you will need to produce a Bitcoin. Normally power isn't a major issue. It might seem like quibbling over nonsense (ie: do you consider the power bill when writing articles online?).

However, Bitcoins require a lot of power due to the vast amount of decrypting required to produce the newer coins. Therefore, it will often cost 3-10X the value of the coin just to make one.

So, there is a cost, and a steep one at that. It's backed by electricity.

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12 years ago

Originally Posted by KimboJim

You're very wrong here. Bitcoins actually cost quite a bit to create.

That may have been true even 5 years ago, but it isn't now, and it is getting less true every month!

First of all, any computer can make them, so you need to invest in a computer.

However, if you want to make Bitcoins quickly, then you need a hardcore server that can handle the huge amount of information required to make newer Bitcoins (they are only getting harder).

Now, let's consider how much power you will need to produce a Bitcoin. Normally power isn't a major issue. It might seem like quibbling over nonsense (ie: do you consider the power bill when writing articles online?).

However, Bitcoins require a lot of power due to the vast amount of decrypting required to produce the newer coins. Therefore, it will often cost 3-10X the value of the coin just to make one.

So, there is a cost, and a steep one at that. It's backed by electricity.

SO, it is YOUR contention that:

1. Computers are rare.
2. Computers cost a lot.
3. Computers aren't getting any faster.
4. Electricity costs money.
5. Computers won't take less electricity.
6. Electricity increases in cost with the value of bitcoins.

I hate to break it to you, but NONE of those statements are true! OK, SOME might take umbrage with #4, but it really doesn't.

Steve

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12 years ago

From what standpoint?

For security in funds? Possibly

To make money? Hell no.

Two companies have produced mining machines capable of 50 g/hashes/sec on the LOW END. And larger machines with much larger hash capability. They have started to roll out but haven't shipped the majority of the units yet. What does this mean? Once the majority of the units roll out.. Mining will become easier for a short while (until the algorithms update accordingly to make hashing even harder) but ultimately the cost of the bit coin will most likely fall. Obviously such measures are built into the system to try and prevent this from happening.. But all it takes is industry speculation (no actualities needed).

Long term? It's just not a market with many known variables since its so new.

If you do decide to invest... Learn the market inside and out. Don't go to a marketing forum asking strangers advice... Start mining yourself. Join a couple mining forums and pools. Do research.

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12 years ago

It's open to manipulation. Also, can you handle the steep drops in value? Plus, it seems many online casinos and specialty content sites are rallying around many different crypto currencies. Bitcoin may soon be just another flavor in the sea of *coins out there...

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12 years ago

I heard the prices were dropping for them. Sadly that fad seems to be dying before it's time and I just found out about them. Still don't quite understand the concept but there are servers related to the niche going for obscene amounts of money.

Amazon.com: Butterfly Labs ASIC MINER Pre-Order...

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12 years ago

BTW the phony arbitrage is EASY! Just make the base price higher for purchases from the exchange, and lower for selling to the exchange. This is an OLD gimmick done EVERYWHERE, and is how gold is often bought/sold, even some stock has a buying and selling price! ******THEY****** show, or must be honest about, a VALID exchange price! GOLD is usually priced according to the CME or the swiss exchange AND, relatively recently, THEY have standardized THEIR prices. You can't just say gold is worth $1000 and that is what you will buy it at. People will just laugh, and you could end up in court!

Steve

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12 years ago

Assuming you are talking about as an investment. I don't own them and I would not purchase them today, but as a very high risk investment (and allocated appropriately in your portfolio mix) it could be a ok.... but when/if you make money - Take the money and run!

This is highly speculative and able to be manipulated very easily. It wasn't too long ago that the price plummeted because of DDOS attacks on one of the popular places to trade this "currency." I can guarantee that there was some group who made a poopton of money on that, but it was at the expense of people trying to get in on this super new scheme.

Basically, this is casino money or on par with penny stocks.... there CAN be a place for it in a person's investment portfolio and an opportunity to make some ching, but you probably would be better off carrying it around in a brief case.

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12 years ago

Only if you enjoy incredibly risky investments.

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12 years ago

Originally Posted by Curtis2011

Only if you enjoy incredibly risky investments.

If by risky you mean make tons of money, then yes it's risky. Think about this for a moment (using the lows reached in the particular year, and today's price of roughly $70):

If you invested $1000 in Bitcoin in 2009, it's worth $70 million today. (lows were around $0.001)
If you invested $1000 in Bitcoin in 2010, it's worth $7 million today. (lows were around $0.01)
If you invested $1000 in Bitcoin in 2011, it's worth $140,000 today. (lows were around $0.5)
If you invested $1000 in Bitcoin in 2012, it's worth $30,000 today. (lows were around $3)
If you invested $1000 in bitcoin in January 2013, it's worth $7000 today. (lows were around $10)

Yeah, looks risky to me. I bought in 2011, at a relatively high price of $7, and so far I've 10X my original investment.

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12 years ago

Originally Posted by looking4adsense

If by risky you mean make tons of money, then yes it's risky. Think about this for a moment (using the lows reached in the particular year, and today's price of roughly $70):

If you invested $1000 in Bitcoin in 2009, it's worth $7 million today. (lows were around $0.001)
If you invested $1000 in Bitcoin in 2010, it's worth $700,000 today. (lows were around $0.01)
If you invested $1000 in Bitcoin in 2011, it's worth $140,000 today. (lows were around $0.5)
If you invested $1000 in Bitcoin in 2012, it's worth $30,000 today. (lows were around $3)
If you invested $1000 in bitcoin in January 2013, it's worth $7000 today. (lows were around $10)

Yeah, looks risky to me. I bought in 2011, at a relatively high price of $7, and so far I've 10X my original investment.

First of all, your prices are contrived! Let's assume they were accurate though! In 2013 you say the low was $7 or less! YEAH, you CLAIM the low was $10 BUT, $7000/1000=7 In 2011 you buy $1000 at .5, and that is 2000 bitcoins. 2000 at 7 is $14000. in 2012, you claim it would be worth $60,000.

Still, it is a proven stipulated fact that the price is rigged. Obviously, it varies a LOT!

Steve

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12 years ago

Originally Posted by seasoned

First of all, your prices are contrived! Let's assume they were accurate though! In 2013 you say the low was $7 or less! YEAH, you CLAIM the low was $10 BUT, $7000/1000=7 In 2011 you buy $1000 at .5, and that is 2000 bitcoins. 2000 at 7 is $14000. in 2012, you claim it would be worth $60,000.

Still, it is a proven stipulated fact that the price is rigged. Obviously, it varies a LOT!

Steve

Dude, you need to get a refund from your math teacher.

Low in 2013 was $10, now is $70, so if you bought $1000 worth, it's now worth $7000, got it?

It does vary a lot, but there's one clear trend, it's worth a whole lot more than it did last year, every year. There's no reason to believe the trend will stop, until at least half of the world population is using it.

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CDarklock

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12 years ago

Originally Posted by looking4adsense

Dude, you need to get a refund from your math teacher.

Dude, you need to learn the difference between math and economics.

Low in 2013 was $10, now is $70, so if you bought $1000 worth, it's now worth $7000, got it?

If you bought it AT THE LOW. At the single most advantageous time you could possibly have bought it. You are equally as likely to have bought it at the high of $266, in which case your $1,000 would be worth $263 at the $70 price point.

However, you are most likely to have bought it somewhere in the $30-$40 range. Which is interesting, because for the vast majority of its existence a Bitcoin has been worth between ten and twenty dollars.

Why is it suddenly worth three to five times this much?

What has happened to create this change in the value?

What is expected to happen?

The usual response is that the value of traditional currency is expected to drop radically Real Soon Now.

So... why is anyone selling?

"Your money is about to be worthless. Luckily, we will happily trade you this valuable thing for it."

What the hell kind of sense does that make?

"We will trade our valuable stockpiles of useful things for your soon-to-be-worthless supply of dumb old currency! Then, when those things become useful, you will have them and all we will have is this stupid currency. Ha ha, what good will that be? We're like, retarded, or something."

Yeah. Sure. I'd buy that for a dollar.
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"The Golden Town is the Golden Town no longer. They have sold their pillars for brass and their temples for money, they have made coins out of their golden doors. It is become a dark town full of trouble, there is no ease in its streets, beauty has left it and the old songs are gone." - Lord Dunsany, The Messengers

12 years ago

Originally Posted by looking4adsense

Dude, you need to get a refund from your math teacher.

Low in 2013 was $10, now is $70, so if you bought $1000 worth, it's now worth $7000, got it?

It does vary a lot, but there's one clear trend, it's worth a whole lot more than it did last year, every year. There's no reason to believe the trend will stop, until at least half of the world population is using it.

OK, I guess I got carried away about the $7, STILL, you then apparently are claiming that the low was in the beginning of the year then(or at least in the first month). Is that your claim for every year?

ALAS, if I wanted to get into it, I would probably "mine" it, since so many others are. Based on what you say the current prices are, it would probably take about 10 bit coins or less than perhaps 4 days to brake even. At times like that..... It seems like some middle of the road machines can average over 3 bit coins a day.

Well, my old neighborhood reached a point where apartments were actually losing business because homes were getting so relatively cheap.

Steve

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12 years ago

Originally Posted by looking4adsense

It does vary a lot, but there's one clear trend, it's worth a whole lot more than it did last year, every year. There's no reason to believe the trend will stop,

There certainly is. The fact that it's worth more every year is itself a reason to believe the trend will stop...economic graphs that shoot up in value quickly tend to end in a burst bubble, far more often than they plateau at some new high level and/or continue increasing in price forever. This is especially true for commodities that have no inherent value of their own (e.g. Bitcoins) as opposed to, say, a stock in a company.

It's far more likely that Bitcoins will end up worthless and forgotten in a few years, than that they will continue appreciating in value indefinitely.

until at least half of the world population is using it.

Why would half the world population use it? It has no advantages compared to old-fashioned national currencies for the average person who isn't a libertarian activist. Currencies like the US Dollar or the Euro lose a predictable 1-2% of their value to inflation per year, whereas Bitcoin fluctuates by thousands of percent per year.

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12 years ago

Originally Posted by NoobSensei

There certainly is. The fact that it's worth more every year is itself a reason to believe the trend will stop...economic graphs that shoot up in value quickly tend to end in a burst bubble, far more often than they plateau at some new high level and/or continue increasing in price forever. This is especially true for commodities that have no inherent value of their own (e.g. Bitcoins) as opposed to, say, a stock in a company.

It's far more likely that Bitcoins will end up worthless and forgotten in a few years, than that they will continue appreciating in value indefinitely.

Why would half the world population use it? It has no advantages compared to old-fashioned national currencies for the average person who isn't a libertarian activist. Currencies like the US Dollar or the Euro lose a predictable 1-2% of their value to inflation per year, whereas Bitcoin fluctuates by thousands of percent per year.

It does have an advantage over world currencies. It can't be artificially inflated like every last currency on the planet. There's a ceiling on how many will come into circulation and every last BTC transaction is available for all the world to see. That means no back room "creation" of Bitcoins out of thin air.

I understand that they were all created out of thin air. But at this point in global history, the same is true for all currency. Unless someone figures out how to hack or crack the system and create bogus BTC, this is, at least theoretically, the most stable medium of exchange there is. In time, the extreme volatility will subside.

Should be interesting to see how it unfolds.

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12 years ago

Originally Posted by travlinguy

It does have an advantage over world currencies. It can't be artificially inflated like every last currency on the planet. There's a ceiling on how many will come into circulation and every last BTC transaction is available for all the world to see. That means no back room "creation" of Bitcoins out of thin air.

That depends what you mean by "artificially inflated." It's true that the Bitcoin supply has a finite limit, but it's still far more volatile than national currencies. Holding Bitcoin as a hedge against inflation when it's appreciated in value by 1000% in the past year alone would seem to be highly counterproductive.

I understand that they were all created out of thin air. But at this point in global history, the same is true for all currency.

Yes, but unlike Bitcoin, other currencies have the backing of a nation-state and millions of people already using them.

Unless someone figures out how to hack or crack the system and create bogus BTC, this is, at least theoretically, the most stable medium of exchange there is.

Bitcoin exchanges are getting hacked all the time. And counterfeiting isn't a major problem with most national currencies anyway, so the stability provided by not being able to create bogus BTC doesn't seem to be worth much.

In time, the extreme volatility will subside.

I agree. Probably about the same time everyone stops using it.

On a more serious note, let's consider the economics of Bitcoin: the thing we all need to remember about Bitcoins is that they are different from commodities such as, say, a barrel of oil or a share of a company, which have inherent value. Bitcoin's only value is derived from the fact that people are (currently) willing to use it. So if you're buying it as an investment vehicle, you're essentially betting that the demand for Bitcoin will rise faster than the supply. You only win this bet if a large number of other people buy into Bitcoin for the same reason...but only after you do.

That sounds an awful lot like a Pyramid Scheme to me, where people buy into an inherently worthless investment vehicle in the hopes that it will appreciate in value as even MORE people buy into it.

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CDarklock

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12 years ago

Originally Posted by NoobSensei

That sounds an awful lot like a Pyramid Scheme to me

*ding* Anna-da boy wins a cigar.
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"The Golden Town is the Golden Town no longer. They have sold their pillars for brass and their temples for money, they have made coins out of their golden doors. It is become a dark town full of trouble, there is no ease in its streets, beauty has left it and the old songs are gone." - Lord Dunsany, The Messengers
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  12 years ago
  
  You can make money from cryptocurrencys if you know what you are doing and keep an eye on the market. A lot of media speculation and half witted crap about "The Dark Net " makes me LOL. There is most prob more of a "dark net" with internet marketing than BTC., where some people will do anything to make a buck.
  There are well known websites who use it now. Cryptocoins are only going to get bigger and more popular over time Keep an eye on some of the other cryptocoins other than bitcoins as well.
  Im suprised that somebody from WF hasent made a " How to get FREE Bitcoins" yet or a minning guide or a wallet guide ...see there are allready some money making ideas for you, and you dont even have to buy BTC to make money from it. Its new, well actullly was on paper around 2008 but there are a lot of new opertunitys with it if you really think about it and not just pumping and dumbing (allthough I do know people who have made a killing doing that as well lol)
  
  I am still suprsied that WF has not jumped on this quicker and opened up a section for cryptocurrencys I did suggest it
  
  Best of luck with what ever you decide
  
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12 years ago

Originally Posted by NoobSensei

That depends what you mean by "artificially inflated." It's true that the Bitcoin supply has a finite limit, but it's still far more volatile than national currencies. Holding Bitcoin as a hedge against inflation when it's appreciated in value by 1000% in the past year alone would seem to be highly counterproductive.

Yes, but unlike Bitcoin, other currencies have the backing of a nation-state and millions of people already using them.

Bitcoin exchanges are getting hacked all the time. And counterfeiting isn't a major problem with most national currencies anyway, so the stability provided by not being able to create bogus BTC doesn't seem to be worth much.

I agree. Probably about the same time everyone stops using it.

On a more serious note, let's consider the economics of Bitcoin: the thing we all need to remember about Bitcoins is that they are different from commodities such as, say, a barrel of oil or a share of a company, which have inherent value. Bitcoin's only value is derived from the fact that people are (currently) willing to use it. So if you're buying it as an investment vehicle, you're essentially betting that the demand for Bitcoin will rise faster than the supply. You only win this bet if a large number of other people buy into Bitcoin for the same reason...but only after you do.

That sounds an awful lot like a Pyramid Scheme to me, where people buy into an inherently worthless investment vehicle in the hopes that it will appreciate in value as even MORE people buy into it.

Whether Bitcoin is "inherently worthless" remains to be seen. I'm sitting on the sidelines watching. I think they have the potential to be huge, even if it only lasts for a short time. There are many reputable financial experts also watching.

As for Ponzi Schemes, the federal reserve invented the modern Ponzi with such opportunistic creativity as fractional reserve banking. And if they can't inflate the currency enough that way they're able to do it through collusion with the Treasury. Then there's Social Security, the FDIC and scores of other government run financial institutions that fit the bill as well.

How many large countries, superpowers even, are technically and practically bankrupt right now? The only reason China doesn't foreclose on all the US paper they're holding is because if we go down so do they and many others. I think it's a bit one sided to point out the potential flaws in Bitcoin without looking at the bloody mess the rest of the world is in as a result of their creation of massive amounts of fiat.

How much actual global value in hard goods is backing all the funny money in existence? I'd be surprised if the ratio was more than a few percentage points. That just about puts greenbacks and other currencies on par with Bitcoin.

You say that Bitcoin's only value is derived from the fact that people are willing to use it. I agree. I also wonder how many people would refuse to trade in dollars if we weren't forced by law (legal tender) to do so.

What I find refreshing about Bitcoin is that it was deliberately developed so as not to be manipulated. It has appeal to the relatively few remaining folks who remember the actual intentions of the founding fathers when it comes to the money supply. Allowing commercial banks to control our money supply has given them the opportunity to literally strip this country of nearly all it's real value and leave the rest of us holding fancy toilet paper and inane ledger entries.

I realize it's not likely Bitcoin is going to be a long term solution to the inevitable collapse but it feels good to think it could be, even if that's a huge longshot. And regardless of what happens long term, there will be fortunes made (in fiat) trading the volatile Bitcoin. That's all there is right now. We have to see where it leads.

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12 years ago

Originally Posted by travlinguy

Whether Bitcoin is "inherently worthless" remains to be seen. I'm sitting on the sidelines watching.

What I mean by "inherently worthless" is that there is nothing you can do with a Bitcoin other than sell/trade it to other people. That makes it different than a barrel of oil or a share of a corporation, or most other commodities...because those things have an inherent value since you can use them for things besides selling them to others.

You say that Bitcoin's only value is derived from the fact that people are willing to use it. I agree. I also wonder how many people would refuse to trade in dollars if we weren't forced by law (legal tender) to do so.

People in many countries around the world prefer to use US dollars and/or Euros instead of their own currencies, despite not being forced by law to do so. I can't speak for anyone else, but I'd keep right on using the US dollar (or other relatively stable currencies) even if I wasn't legally required to do so.

If doomsday is coming, I'm sure not seeing it. Instead, I see a world that is far better off than it was 50 years ago by almost any metric we can devise.

What I find refreshing about Bitcoin is that it was deliberately developed so as not to be manipulated. It has appeal to the relatively few remaining folks who remember the actual intentions of the founding fathers when it comes to the money supply.

Perhaps. I just question whether there are enough libertarian activists out there to actually sustain an artificial currency. I strongly suspect not. To the average person who just wants to do business online, and doesn't care and/or agree with the libertarian view, there is little reason to use Bitcoin over a more traditional medium of exchange.

I realize it's not likely Bitcoin is going to be a long term solution to the inevitable collapse but it feels good to think it could be, even if that's a huge longshot. And regardless of what happens long term, there will be fortunes made (in fiat) trading the volatile Bitcoin. That's all there is right now. We have to see where it leads.

There are fortunes to be made trading Bitcoin, yes. But it's a zero-sum game; every transaction will have a winner and a loser. IMO, any commodity where people are betting on how other people will value it in the future, rather than its underlying value, is a dangerous game to be playing.

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12 years ago

Originally Posted by NoobSensei

What I mean by "inherently worthless" is that there is nothing you can do with a Bitcoin other than sell/trade it to other people.

This is what currency IS. The idea of "a dollar" is just a convenient measure of absolute worth. If a cow is worth six chickens and then there's a huge chicken disaster that kills half the chickens, it's impossible to tell from a direct cow/chicken exchange whether the price of a chicken went up or the price of a cow went down. But if a chicken is $10 and a cow is $60, then the chicken disaster drives the price of chicken to $20 and you can tell.

The idea of Bitcoin is a nice one, theoretically. All currencies are currently backed by the promises of nations and governments. The Bitcoin argument is that you cannot trust nations and governments, and that it would be better if a currency were backed by sound and objective mathematical principles.

Which is all well and good if you are the kind of person who trusts mathematical principles, which the overwhelming majority of the world's population does not.

My father believes induction is a magic trick and algebra is a religion. When you say "but 10x - x = 9x every single time," he says "you can't prove that" and then when you say "LOOK HERE IS THE PROOF" he says "that doesn't prove anything, it's just math" and I want to strangle him.

You can call him stupid all you like, the fact is, a lot more people are like him than are like us.

I just question whether there are enough libertarian activists out there to actually sustain an artificial currency.

There certainly aren't enough to sustain a Presidential candidate.

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12 years ago

Originally Posted by CDarklock

This is what currency IS. The idea of "a dollar" is just a convenient measure of absolute worth. If a cow is worth six chickens and then there's a huge chicken disaster that kills half the chickens, it's impossible to tell from a direct cow/chicken exchange whether the price of a chicken went up or the price of a cow went down. But if a chicken is $10 and a cow is $60, then the chicken disaster drives the price of chicken to $20 and you can tell.

The idea of Bitcoin is a nice one, theoretically. All currencies are currently backed by the promises of nations and governments. The Bitcoin argument is that you cannot trust nations and governments, and that it would be better if a currency were backed by sound and objective mathematical principles.

Which is all well and good if you are the kind of person who trusts mathematical principles, which the overwhelming majority of the world's population does not.

My father believes induction is a magic trick and algebra is a religion. When you say "but 10x - x = 9x every single time," he says "you can't prove that" and then when you say "LOOK HERE IS THE PROOF" he says "that doesn't prove anything, it's just math" and I want to strangle him.

You can call him stupid all you like, the fact is, a lot more people are like him than are like us.

There certainly aren't enough to sustain a Presidential candidate.

We don't know!

Voting is treated as a GAME! It is a game that requires ********TWO******** options! *****TWO*****! So you can't have a libertarian, green, etc.... presidential candidate. A vote for them is likely to lose. So if a libertarian is conservative, and loses with 25%, the democrat is likely to win.

BTW the electorate system helps to FORCE the two choice concept. The lack of that may be a reason why we have viable candidates in other parts of the government that have no affiliation with the two main parties.

If people realize that and *****DEMAND***** that options allow for MULTIPLE choices, you might find a libertarian may even get 100% of the vote, because people will know that voting for a libertarian will NOT count as a vote for the candidate they LOATH.

With a monetary choice, each unit of currency you have can be placed in a different choice. So buying bit coins doesn't mean you rely solely on it.

Steve

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12 years ago

Originally Posted by looking4adsense

If by risky you mean make tons of money, then yes it's risky. Think about this for a moment (using the lows reached in the particular year, and today's price of roughly $70):

If you invested $1000 in Bitcoin in 2009, it's worth $70 million today. (lows were around $0.001)
If you invested $1000 in Bitcoin in 2010, it's worth $7 million today. (lows were around $0.01)
If you invested $1000 in Bitcoin in 2011, it's worth $140,000 today. (lows were around $0.5)
If you invested $1000 in Bitcoin in 2012, it's worth $30,000 today. (lows were around $3)
If you invested $1000 in bitcoin in January 2013, it's worth $7000 today. (lows were around $10)

Yeah, looks risky to me. I bought in 2011, at a relatively high price of $7, and so far I've 10X my original investment.

Oh yeah, it's nothing but a cash machine. This doesn't look like a bubble or anything! :rolleyes:

Oh wait, it WAS a bubble, and people who bought at the wrong time lost tons of money:

The price of Bitcoin is going DOWN and buying now is a stupid idea. The trend is almost perfectly following this classic chart:

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12 years ago

Originally Posted by Curtis2011

Oh yeah, it's nothing but a cash machine. This doesn't look like a bubble or anything! :rolleyes:

Oh wait, it WAS a bubble, and people who bought at the wrong time lost tons of money:

The price of Bitcoin is going DOWN and buying now is a stupid idea. The trend is almost perfectly following this classic chart:

This graph is awesome. I must say.

Bitcoin is a big bubble right now, who knows when it will crash.

I am not telling anyone to do anything, but what I would recommend is that one does their homework very in depth before plunging in. I mean, people learnt from the last stock market crash in 2008, everyone and even the guy shining my shoe on the street was saying the stock market will never go down again in 2007, and little did they know it was about to crash harder than we have seen in many years.

They did not do any research.....

So make sure before you invest, do your own research, and get help from a professional, and only invest with money you can afford to lose.

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12 years ago

Originally Posted by celente

only invest with money you can afford to lose.

This is Awesome Advice! Only Invest Money You Can Afford To Lose..

Because otherwise you are just gambling and anyone who is smart knows that even when you go to the casino to gamble you only play with money you can afford to lose.

Gengis
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HelpingYouBeAnExpert

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12 years ago

Originally Posted by Curtis2011

Only if you enjoy incredibly risky investments.

risky is anything a central bank prints out of thin air, that's risky (and deceptive)
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12 years ago

Can Bitcoins be used as a way for members of a website to donate to for running costs?

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12 years ago

Bitcoins aren't that really popular right now. And are mainly used on the dark net, so that transactions can't be tracked. But I did see on the news that someone developed a ATM for bitcoins. So it may be come a official currency some day.

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NoobSensei

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12 years ago

Bitcoins are a horrible investment IMO. The price fluctuates wildly, and varies depending on the length of time since the last major hacking or the last high-profile mention in the media.

As far as I can tell, the only people who use them are libertarian activists trying to make some sort of ideological point, and shady online criminals who want to launder their money. They certainly aren't a stable source of value that will be used by mainstream e-commerce anytime soon. If you want to make money in high-risk investments, better to just invest in REAL foreign currencies IMO.
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12 years ago

Bitcoins aren't stable, their value decreases/increases daily.
I had seen in T.V(Discovery). that a man lost his Bitcoins valued $1M because he forgot his password.

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12 years ago

I've recently started watching Bitcoin. I wouldn't buy right now. The price is down around $13 over the last three days trading at $68.8 or so as I write this. Something I learned long ago about stuff that trades in an open market. Don't buy when it's trending down because you have no idea where it will stop.

From a technical analysis standpoint BTC has recently broken two support levels and is heading down to a third. If it goes through that one it might not stop until it's in the teens. I'd say that anyone interested in picking some up should just watch and wait a while.

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12 years ago

Originally Posted by onlinemoneymakerguy

I read in a website that the price of Bitcoin will rise within a year.

Do you think it will be a wise move to buy Bitcoins?

From your statement above my answer is no.

Why?

Because if you are going to make your choice based upon something that you read on a website, then obviously you do not know enough about the item to invest in it.

This is no different than someone asking if they should buy a specific car, or specific piece of artwork cause they read some where that that value of that item is going to increase.

With no knowledge you are just gambling, which is not a good idea.

Instead, educate yourself on bitcoins first, (and topics like fiat currency, exchange rates, the gold standard, etc) and then you will be in a position to make a decision on whether or not it is a good investment.

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12 years ago

Thanks everyone for your input.

Is it a good idea to buy bitcoins from Ebay?

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seasoned

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12 years ago

Originally Posted by onlinemoneymakerguy

Thanks everyone for your input.

Is it a good idea to buy bitcoins from Ebay?

Would you buy a new dollar bill on Ebay?

If yes, WHY!?!?!? Do you think they would sell it below cost? If they sold it AT cost, WHY pay the premium for ebay? In theory, a currency on ebay would only sell at a PREMIUM!

BTW, I specified NEW currency! An older TANGIBLE currency may have content(like be made out of silver or gold), or some mistake or something that makes it UNIQUE, and it then has an INTANGIBLE cost! Such things are generally NEVER sold in a bank or acquired on the street, so they DEMAND a premium and thus are on Ebay or some special coin store. Even then, they RARELY sell at cost or below!

Steve
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12 years ago

eBay could go either way but it's more likely you're going to pay through the nose there. Here's an auction that ended today.

05 Bitcoin Visa MC 1 20 BTC Trusted US Seller Cryptocurrency Digital Money | eBay

The buyer bought 1/20 BTC for $10.50. That's $210 per BTC. You can buy BTC in the open market right now for $68. So the guy who just paid $10.50 for 1/20 (.05) BTC could sell it for $3.40 or a $7.10 loss. Not too smart.

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12 years ago

Originally Posted by travlinguy

eBay could go either way but it's more likely you're going to pay through the nose there. ... Not too smart.

It is for the seller. Think about it.

You start a 7-day auction. At SOME point during that seven days, Bitcoins get up to some high value or other. People bid a fair (low!) price for that value, but the value will almost certainly change. In the end, you only deliver to the highest bidder... who is required to pay what he bid, even if the price has changed.

For each auction you run, you will need exactly one idiot who makes a dumb bid.

For Bitcoins.

On eBay.

Seriously, do you think that would be hard?

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"The Golden Town is the Golden Town no longer. They have sold their pillars for brass and their temples for money, they have made coins out of their golden doors. It is become a dark town full of trouble, there is no ease in its streets, beauty has left it and the old songs are gone." - Lord Dunsany, The Messengers

12 years ago

Originally Posted by CDarklock

It is for the seller. Think about it.

You start a 7-day auction. At SOME point during that seven days, Bitcoins get up to some high value or other. People bid a fair (low!) price for that value, but the value will almost certainly change. In the end, you only deliver to the highest bidder... who is required to pay what he bid, even if the price has changed.

For each auction you run, you will need exactly one idiot who makes a dumb bid.

For Bitcoins.

On eBay.

Seriously, do you think that would be hard?

I'm with you, I think. You tell me...

The original question was, Is it a good idea to buy bitcoins from Ebay? Here's my take. Right now most eBay sellers are offering Bitcoins and fractions at fixed prices.

The example I used yesterday had someone buying .05 BTC essentially somewhere in April's price range. Had he gone to one of the many exchanges he'd have been able to get it much, much cheaper. The point I tried to make yesterday was that eBay is definitely not the place to buy because it's far more likely the seller will end up better off, especially if he bought well below current levels.

Again, $10.50 for 1/20 BTC (yesterday's example) puts the actual price of a single Bitcoin at $210. This was a losing proposition for any buyer at the time the listing went live because the price for one BTC was around $85 at the time. Why are buyers doing this? Only God knows. There's no shortage of BTC.

The other side of that equation would go something like this. As I write this you can buy one Bitcoin for about $66. Let's say a seller had BTC back at $10. So he puts up a single unit at the going price now, $66. In a "buy it now" offer someone is going to scoop that thing as BTC rises just a few bucks and hopefully lock in his price and get some immediate appreciation. Done deal, transaction over. The buyer will get a slight bargain and the seller will do well too, mainly because he bought in so low.

If it's an auction it's likely to get bid up as the market price of BTC rises. And theoretically, it should get no action if it falls under the set minimum bid. But if it starts to move up there's no guarantee it's going to continue to rise and could fall back at any time putting the high bidder in a loss position. Bidders are rolling the dice while the seller's position is safe as he got in at $10.

Personally, I don't understand why sellers or buyers (especially buyers) would be messing with eBay at all. As I wrote this I watched an actual eBay auction for 1 BTC close at $84. What the hell was the buyer thinking? He could have gotten that unit in the open market at $66, $18 cheaper. Here's the auction: One 1 Bitcoin BTC Quick Delivery Paypal Accepted | eBay

I mean, don't people realize they can get these things at numerous exchanges worldwide? In fact, there's enough variance in price from exchange to exchange for some nice arbitrage.

Maybe I'm missing something as I've just started to study the whole Bitcoin phenomenon.

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CDarklock

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12 years ago

Originally Posted by travlinguy

I'm with you, I think. You tell me...

We're on the same page.

Bitcoins are basically forex. That's it in a nutshell. They are not your home currency, because they are not anyone's home currency. So you research and evaluate them exactly the same way you would any other foreign currency.

In this case, the "country" that uses Bitcoin formed less than a decade ago and has no imports, exports, or assets of any kind. Neither does it have any trade agreements with other nations.

Any forex investors care to tell me whether this currency is a good investment?
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12 years ago

Never use PayPal for a BitCoin transaction. You will lose money. PayPal does not (Currently) support BitCoin and the people in charge seem to love to screw people out of money when they find out it was a bitcoin transaction.

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12 years ago

Wow I knew they were failing but I did not know it was this bad...lol so what was the advantage of the bitcoin in the first place? Anybody know? Or was it just something new that tried to catch on?

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12 years ago

Originally Posted by Big Money

Wow I knew they were failing but I did not know it was this bad...lol so what was the advantage of the bitcoin in the first place? Anybody know? Or was it just something new that tried to catch on?

The advantage is that if you have a Bitcoin, nobody will ever stop you from sending it to anyone else with a Bitcoin account.

In other words, no more account freezes. No PayPal holding your money hostage or "limiting" your account because you logged in from an Ethiopian proxy by mistake -- and doing it either forever or until you can cough up your birth certificate and a blood sample. No bank saying "sorry, wiring that will cost $30, except wait, we don't do wires to that country."

Unlike e.g Liberty Reserve, it's impossible for Bitcoin to get "raided" (costing you all your money) because too many criminals were using it.

Also, anyone can have as many Bitcoin accounts as they want, and nobody ever asks for ID.

The downside... as everyone's pointed out, it's quite volatile. The most recent $260 spike wasn't the first time the currency has gone up-up-UP and then crashed back to earth. It seems to happen every year or so.

The volume of Bitcoin trading is also so low (and buyers and sellers often so panicky) that anyone with a few hundred thousand or a few million to play with can manipulate the price fairly easily.

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12 years ago

Originally Posted by andreas3

The advantage is that if you have a Bitcoin, nobody will ever stop you from sending it to anyone else with a Bitcoin account.

WRONG!

In other words, no more account freezes. No PayPal holding your money hostage or "limiting" your account because you logged in from an Ethiopian proxy by mistake -- and doing it either forever or until you can cough up your birth certificate and a blood sample. No bank saying "sorry, wiring that will cost $30, except wait, we don't do wires to that country."

WRONG! And some of those limitations have a valid reason!

Unlike e.g Liberty Reserve, it's impossible for Bitcoin to get "raided" (costing you all your money) because too many criminals were using it.

WRONG!

Also, anyone can have as many Bitcoin accounts as they want, and nobody ever asks for ID.

The downside... as everyone's pointed out, it's quite volatile. The most recent $260 spike wasn't the first time the currency has gone up-up-UP and then crashed back to earth. It seems to happen every year or so.

The volume of Bitcoin trading is also so low (and buyers and sellers often so panicky) that anyone with a few hundred thousand or a few million to play with can manipulate the price fairly easily.

TRUE! And low volume is a BAD sign!

Steve

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andreas3

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12 years ago

Originally Posted by seasoned

WRONG!

Mind backing up your assertion with more than just "WRONG!"...?
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12 years ago

Originally Posted by Big Money

Wow I knew they were failing but I did not know it was this bad...lol so what was the advantage of the bitcoin in the first place? Anybody know? Or was it just something new that tried to catch on?

Ironically, the valid selling points are EXACTLY what hurts it. INVALID points are things like limited quantity. WHO CARES? I could create a picture and GUARANTEE it to be unique. That won't mean it is worth a fortune.

Steve

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12 years ago

I wouldn't cause them a safe bet. A month and a half ago, they were at $120 or more and now there are $70. What if you had made this investment a month and a half ago? You would have lost 42%. In my opinion unless Bitcoins get under $25 or so they are not a safe investment.

They can be considered a good high risk investment and sure there is a chance they'll make you money but its a very high risk thing. You'd be better of with penny stocks high risk, higher potential to go up. But they also have a high potential to go down and go down quickly.

Best of luck!