Bitcoin

[Guest Funktion]

http://www.bitcoin.org/

 

 

so in the wake of the financial crisis, it seems nobody can trust bankers, financial institutions or governments who might actively inflate or deflate their own currencies for whatever reason. hearing of this, some japanese nerd called satoshi nakamoto set about designing an open source and completely anonymous peer-to-peer digital currency called 'bitcoin'.

 

it's clearly still in its infancy and right now appears to just be an experimental economy of around 10,000 geeks trading bitcoin between each other for no real reason, but as the internet becomes more pervasive i don't see any reason why this can't become as big as paypal or even bigger. since i only have a rudimentary understanding of economics its difficult for me to tell you what the actual benefits of this would be were it to grow, but i know for a fact there's people on this forum (Bread probably) who would jizz over this.

 

what interests me will be (if bitcoin takes off) if we will see the development of other digital financial instruments, loans, credit default swaps etc

 

 

in summary: hurray for ingenuity and tenacity of nerds.

[Guest disparaissant]

I saw a thread about this elsewhere. Apparently there are a load of sites where you can buy drugs. One I saw even has a currently empty "Weapons" section. Soooo.

[chim]

Nice initiative!

[Guest Funktion]

just got 0.05 bc with bitcoin faucet, zomg

[karmakramer]

haha this is awesome and kind of crazy

[Cryptowen]

I bet if you were crafty enough you could make a living just off of trading virtual currencies like this & MMO money for real world money.

[GORDO]

make me bitrich: 13BRTUE2e2Krun67K5otWfa8q3Db5jvPex

[Guest Funktion]

totally just gave you a bitcoin for no reason gordo, enjoy your worthless currency

[GORDO]

not showing up, i think my non-connectivity might stop me from being a virtual millionaire. we need ipv6 asap. and by we i mean i.

Edited February 17, 2011 by GORDO

[Guest Funktion]

yeah, mine was broken for awhile until i realised port 8333 was closed

[chaosmachine]

i was looking at this a couple months ago... if it ever takes off, the government will just introduce a 100% tax on bitcoin income, and start setting up sting operations...

[Guest Funktion]

well i would hope that if it was big enough, that sort of legislation would be incredibly difficult to enforce.

 

here's a nice little article introduction to it: http://www.irishtimes.com/newspaper/finance/2010/1126/1224284180416.html

[Guest fox]

how is this different from regular currency, exactly? i mean, the only thing i can think of is that, unlike fiat currency, it's not back by the full faith and credit of a nation state.

[jhonny]

I want a bit coin!

1FaeXi5usuSTXYqPcFeGDAF6Mu1yjzYQhA

[Guest Funktion]

basically what you just said, plus there is no transaction fee, and transactions don't have to take place through a trusted third party like a bank, the bitcoins go straight to the recipient.

 

edit @fox

Edited February 17, 2011 by Funktion

[Guest fox]

basically what you just said, plus there is no transaction fee, and transactions don't have to take place through a trusted third party like a bank, the bitcoins go straight to the recipient.

 

edit @fox

 

ooooookaaaay . . . but i still don't get how that's beneficial. not trying to be a jerk, but what would prevent me from sticking locking 30 chinese hackers in a basement and having them "manufacture" massive amounts of bitcoin (other than morals and my wet basement)? i guess the concept is either poorly thought out or poorly understood by me. or both.

 

(and yes am i aware of the irony of an american complaining about computer folks "manufacturing" money, as that's what the fed has been doing over the last couple years)

[Siegecow]

this is a cool idea but bread would hate it because its still a monetary system.

 

it also confuses me how there can be no inflation. If it really is just a bunch of nerds trading bitcoin for no reason then how much bitcoin is there to trade? why wouldnt that number get larger when more people started using bitcoin?

 

What is the current value of bitcoin? If it's nothing why would it ever have value? If it already has value why does it?

 

ps what the heck does "open source"/"anonymous" currency mean?

 

edit: i guess i get the anonymous part, but that seems like it could be way sketchier than swedish banks

Edited February 17, 2011 by 24ourange

[Guest Funktion]

you're right. this whole thing hasn't even been thought through. if only someone had thought about the chinese hackers during the development and implementation of this idea.

 

 

i havn't looked at the source code so i can't give you a detailed explanation as to why that wouldn't work, but presumably it's the same thing that's preventing you from harnessing them to build a giant money printing machine.

 

edit @fox again

Edited February 17, 2011 by Funktion

[Siegecow]

im also quite flustered that these things arent called credits

 

You just cant fly around the galaxy trading bitcoins. Thats crazy.

[Guest Funktion]

this is a cool idea but bread would hate it because its still a monetary system.

 

it also confuses me how there can be no inflation. If it really is just a bunch of nerds trading bitcoin for no reason then how much bitcoin is there to trade? why wouldnt that number get larger when more people started using bitcoin?

 

What is the current value of bitcoin? If it's nothing why would it ever have value? If it already has value why does it?

 

ps what the heck does "open source"/"anonymous" currency mean?

 

edit: i guess i get the anonymous part, but that seems like it could be way sketchier than swedish banks

 

there might be 13 million in circulation now, but i cant remember if i just made that up in my head or not. the system is designed to asymptotically approach and remain at 21million tho. i think it's trading at around 1bitcoin-$1.05. you know alot of these questions are answered here http://www.bitcoin.org/faq#What_is_Bitcoin and other places.

 

the thing about "why does it have value?" is incredibly interesting to me though but in terms of our current fiat currencies. i was trying to find if there was any identifiable law which recognises them as such, but legal history is a rabbit hole that's a little too deep for me to want to get into.

[chaosmachine]

the basic idea is this:

 

1. there's no inflation. there's a fixed number of coins in existence, and no more will ever be created.

2. digital signatures are used to sign and verify the coins, and it's impossible to create fake coins (baring a sudden, incredible advance in computing that would invalidate all encryption currently in use).

3. the coins have value because they can be exchanged for goods and services (just like paper money). the number of places you can spend them is slowly increasing.

4. spending the coins is as easy as sending someone a text file, and no third party or bank is required to exchange or store funds.

 

since the government can't track or tax these transactions easily, they will want to stop this. the easiest way to do that is to write a law declaring 100% tax on bitcoin transactions, then set up sting operations: go to the biggest bitcoin shops, spend some coins, see if it gets reported as tax income. if not: tax evasion -> go to jail. a couple dozen busts like this, and no one running a legitimate business will want to accept bitcoins anymore.

[Guest nene multiple assgasms]

[spratters]

the number of places you can spend them is slowly increasing.

 

Where are these places you can spend this fake money then?

 

The thing is I don't disagree that it may take off in some way even though I think it's ridiculous. There are fuck knows how many people out there helping make a multi million pound empire out of online farms that don't do anything and poker where you don't win anything. I remember reading an article about one of the first people to release one of these farm/shop/town/gang gamesand was blown away at the progression of his seemingly worthless business.

[Siegecow]

the basic idea is this:

 

1. there's no inflation. there's a fixed number of coins in existence, and no more will ever be created.

 

I dont understand, looking at this graph it says there are approx 3 billion bitcoins circulating and that number is constantly increased over time until it tapers off. How is this constant addition of new bitcoins NOT inflation?

As you can see the supply of bitcoins will more than double within 10 years. Unless the demand for bitcoin increases proportionally to match that inflation, won't the currency become more and more worthless? What's the point of investing in a currency that inflates at a much faster rate than any national currency and never decreases?

Edited February 17, 2011 by 24ourange

[chaosmachine]

the number of places you can spend them is slowly increasing.

 

Where are these places you can spend this fake money then?

 

 

https://en.bitcoin.it/wiki/Trade

 

already you can buy everything from car detailing to t-shirts to webhosting. you can also exchange them for usd, so...