Bitcoin Forum

I can't pay taxes with it. I can't fund my credit card with it. Why do people value Bitcoins at $11 a piece?

Anonymity.

Because there's only a limited amount of them?

That's not sufficient, signed copies of my first album are downright scarce, but also worthless.

Because they can use them to get $11 (or more) worth of value in goods and services.

Ask the same about gold.

How about the mix of Scarcity, (Provable/non reversible/Almost instant/Almost free) transactions, Final Control/Power over your money,  The ability to keep it in your head and no where else, The ability to be kept in just about any form you could want to store value in, The already existing user base that has already spent money either directly buying bitcoins or buying hardware to acquire bitcoins... did i miss anything?

Taxes and CC suck.

Bitcoins are awesome, not mostly for what you can do with them now (as a simple consumer I mean, I can run a business and make global payments instantly for nearly free), but for their properties.

Durability and divisibility and difficult (dare I say impossible) to counterfeit.

Because entrepreneurs say so!  :)

You can. But as someone stated before, CC suck.
But if you are really interested in doing so, it's possible to send your coins to bitcurex.com, buy a CC there and and charge it with your coins.
And finally the taxes argument... you can't be serious, right? 8)

Trust and security.

Basically everyone has complete tust in bitcoits not disappearing overnight and the security in which bitcoins not becoming worthless in comparison to other currencies (usd, gbp).

Compare to the Euro - people are losing trust in the euro, it could disappear and force everyone to revert to a localized currncy and the security of its worth is depreciating in comparison to other currncies (see the eur/usd swap rates over a three year period on forex sites)

And as for the taxes thing, if bitcoins became the next usd by some miracle governments would simply place high taxes on goods and services to compensate for the decrease in income tax revenue.

Why do people assign value to anything?
It's supply and demand that sets the value of the coin, yet it's only human to set a value to something in general.

Usability, anonymity, and possibly novelty even play a small part.

Sure you can.

For the same reason why people value gold at $1700 per ounce.

For the same reason cigarettes have value in prison even to non smokers.

A carton of newports is worth 2 bald asian guys these days. That's value.

That is probably the best comparison on the list so far :-)

Because someday, once I've been digitized... I plan on putting them all into a digital vault and swimming in them.

 ;D

Hooped cigs (ie butt-smuggled) or not? would hooped be worth less than non? what about in a women's prison? would pink-smuggled cigs be worth more or less than non-vaginally-concealed cigs?

How comes people take lousy 11$ and give a total of one bitcoin away?

Hehe, first post and probably your last?

Is it just me or do recently a lot of accounts pop up, crating on single thread and are then never seen again.

But just in case this is a real question:

Bitcoins provide the usability of cash, although you can instantly pay them in every wallet world wide.

This usability provides value.

The fact, that they can't be printed instantly by anyone (infation resistant) increases the value even more.

And then they are only a few of them + most of them are horded and not available on the open marked, causing a high price.

A US dollar is recognized as cash because people have to accept them for debts including taxes. People are forced to trade oil for them all around the world. Bitcoin has nothing like that so why is it even used as money? That is my question. But it seems since some geeks like it, others rely on that value when holding and using Bitcoins.

This is very different... almost religious...

1) Bitcoin removes the counterparty from the currency. You do not have to trust a government. You instead have to trust in mathematics and the stability of a self-regulated community. (as such there is still some trust required)
2) Bitcoins are cash like and are superior to cash on many levels (money on your bank account is not cash)

Here's some homework for you: try to do a cash-like transaction with someone in another country

Okay, it's easier to trade Bitcoins around the world but what makes them worth trading for? Why would I want a Bitcoin over a half ounce of silver?

No joke - do the homework. Try trading silver over larger distances. You really need to experience the difficulties with cash-like transactions before you can appreciate bitcoins.

Metals and paper cash are short distance exchange vehicles. Virtual currencies extent the interaction range of cash transactions to all people with internet connection.

Why is the half ounce of silver valuable to you?  You aren't going to put it in your teeth, and you probably don't manufacture mirrors or photographic film, so... it is probably valuable as nothing more than a means of trade.  Same with the bitcoin.

Why silver?  This is due to nothing more than a global consensus that it has all the properties needed for use as money.  Gold is chemically more stable, which makes it more valuable as money, but also is very difficult to use in small units, creating a demand that silver happens to fill.

So it's like a digital gold?

Interesting. Thanks.

You may not want bitcoin over half an ounce of silver. It depends what your requirements are.

That's how I like to think of it. It's scarce, relatively inflation-proof and is "mined". Of course, it's not so easy to ship a bar of gold across the world for less than a penny!

That's really the thing that will eventually make bitcoin survive and prosper... if we can get it to be used by someone in a commercial capacity to move money around.

The lack of force is another thing I think gives bitcoins value, no one has to use bitcoins, we choose to

Yes, but better.

Here's a list of advantages of Bitcoin (https://en.bitcoin.it/wiki/Myths#Bitcoins_don.27t_solve_any_problems_that_fiat_currency_and.2For_gold_doesn.27t_solve), and some more (http://whybitcoin.tk/), and some more (http://bitcoinmedia.com/bulleted-advantages/).

Try to buy product on SR with any other form of cash/currency/stored value with out first converting it to BTC.

Try transporting $20,000.00 of cash/gold/or silver on a plane to another country.

** pink-smuggled cigs would probably be much more valuable in male facility then Hooped cigs in a female facility (I would think).

Actually, no bitcoin is not comparable to gold because it lack inherent value. There also is some inherently valuable aspect to the blockchain mechanism because it can be used to sign the existing of arbitrary information, at a specific date, like a computer file, but it doesn't play much role currently.

People assign value to it as part of the consensus formed by the market. That is possible because you can trade them.

interesting TED talk on "perceived value"

http://www.getrichslowly.org/blog/2011/01/13/all-value-is-perceived-value/

Why would gold have "inherent value"?

Silk Road.

Electronics, Gold contacts are pretty awesome. And since there isn't really a better material for that application it will have that property for a long time.
Also it's shiny and do not give you any skin-rash so many people use it as jewelry. You might want to discard that depending how you look at it, but still it's half the gold out there.

Three things:

1: I would give somebody $11 for 1 btc because I think the btc will be worth more in the future than the $11.

2: I can give somebody the bitcoin and get $11 worth of value back. (Or better, depending on where you go. Recently purchased some books on BitMit.net for less than 1 USD worth of BTC, those same books would have cost me $32 on Amazon.com)

3: There is more to life than taxes. I rarely send any money to the government at tax time (my employer and government work together to take money out of my paycheck and then each year I have to ask for the extra back, last year I got about 10% of my income as a tax return).

because they are the cash for digital age.. and they gonna replace ******* banks in near future

I do not think banks will be completely replaced in the near future. There is more to banks than just what bitcoin does.

BTCrules.  ;D  If you don't like BTC then you suck.  >:(  I love BTC trading  :D and BTC mining  8) and BTC funding  :P and all the little BTC people out there.... :-*
BTC forever!!!  ;D

Fiat currencies that can be produced in any amount will always go to their intrinsic value, zero. The US Dollar is going to be worth about as much as the Zimbabwe Dollar(look it up, fascination story).

The gov would not allow a competing currency to rise up without a fight. The US has gone to war with other countries for less (many conspiracies on this). I do think btc and gold, silver, are going to be one of the best investments one can go into. We'll see

You should probably increase your exemptions. Otherwise, you're just giving the government an interest free loan.

I've got my exemptions cranked up as high as they can go. I just have a combination of a moderate salary and a larger family, not much more that I can do.

Bitcoins, which you can think of like 'Internet Cash', can't be traced (easily) and cannot be revoked (chargeback) once sent). Once the payment is made, that's it.

It's a double-edged sword though since who you send to can just say 'thanks very much, bye'.

The value comes from it being used to barter for things that people wish to keep quiet, like illegal drugs.

http://z1x.dk/2011/07/the-bitcoin-comic-by-z1xwitch-awkwardmoment/

Ahahahahhaha, Im paying my taxes with it, I have funded my parents credit card with it, And One bitcoin to me is worth more than $1000 Fiat Euros
Seriously. Offer me $1000 Euros for a bitcoin, Just so i can say NO.
Why? Because my bitcoin is worth more, To me, And to the people who use it.

(as a bitcoin miner in general) If i say its worth more, try to sell it for more, And if people agree and purchase it at the higher price, Then the reason as to why its COMMON value is around $10.50USD, should be obvious. Its because we feel its worth more.


Do we really need to go Back In Time to explain why they are worth any value atall?
I'll trade you Millions of BEAUTIFUL SHINY SUNREFLECTING LUSIOUS BROWN PLATES (peices of polished copper)
For your worthless dirty, Ulgy, old, used and smelly peice of RoadKill. (A racoon hat)

Whats gonna happen? It all depends on if the Racoon Hat seller's country has heard/seen of Copper yet.

YOUR government, The US government, Would goto war over something like a Rising Currency.
And i would be on the other side, Killing you for DECLAIRING a type of Currency "Bad and illegal" Why? Because they could be worth Anything Anywhere.

Fuck the United States' lust for war, You have the Biggest debt, And you plan to FIGHT it away, Rather than bend over backwards like a man, And take your medicine that you loaned from China.
Or hey, Hey how about this, US invests in bitcoin, And saves themselves from collapse, Why? Because they could be worth Anything Anywhere

D'you guys remeber when USA tried to buy oil from Iran and Pakistan? And Iran wouldnt take USDollars?, They wanted things like Gold/Silver The US Shot the fucking guy, And waited for the next guy to accept USDollars.
Well, He said NO aswell, Poof, Gone from history and Silenced.
Next guy stepped up and took a buncha Shit Printed USDollars that took about a Day to crank out. Its worthless.

You have an interesting view on history. Blame the USA for anything if it makes you feel better... but the fact of the matter is: A fertile land, founded on liberty has the potential to raise great and terrifying harvests.

The USA has generated greater good than any other nation on earth. See the internet, which is without a doubt the greatest tool to promote freedom that has ever existed.

Liberty? :-\ Not for the original inhabitants (native indians).

Right. How funny that the same USA now fanatically tries to control, own, censor, manipulate and restrict their internet in any way it can, for commercial and political reasons.

Sure, the US has generated great things, but recently we have a history of smashing up other peoples countries. Just think how much better things could be if the US was more cooperative and less hostile!

I assume that you are paying your Income Taxes to the U.S. and receive an annual W2 from your employer for filing your taxes? If so, then you most likely had to fill out a W4 when you were hired. I'm not aware of any limit on allowances on line 5 of the W4.  You may want to get a copy of IRS Publication 505 "Tax Withholding and Estimated Tax" and look it over.  Then get a copy of your current W4 and a blank W4 from your employer.  Taking the following actions on your W4 with each employer may help you use that extra 10% throughout the year rather than lending it to the government for free every year.

• Verify in the "Personal Allowances Worksheet" on your W4 that you have a 1 in line A, line B, and line C
• Verify in the "Personal Allowances Worksheet" on your W4 that the number in line D matches your actual number of dependents
• If you have at least $1,900 in dependent care expenses, verify that you have a 1 in line F of the "Personal Allowances Worksheet" on form W4
• Double check your math on your calculation of the value for line G of the "Personal Allowances Worksheet" on form W4
• If you typically itemize your deductions, make sure you fill out the "Deductions and Adjustments Worksheet" on form W4
• If your wife is also employed, or you work more than one job, be sure to fill out the "Two-Earners/Multiple Jobs Worksheet" on form W4

If all of the above have been done correctly, and you still find that you receive a refund of 10% of your income at the end of the year, consider increasing the number in line 5 on the W4 by 1 or 2.

Because I don't pay taxes with it.

I'll sell you TWO bitcoins for 1000 €. PM me.

Drugs, mmkay.

I believe that growth only comes after trauma... If the USA was less hostile... everyone in the EU would probably be speaking German. Jews would be extinct. The middle east would still be busy making war with each other. Africa would probably be mostly depopulated.

I don't think those places would be better off without US intervention but the people would probably be happier (if they weren't dead).

IMO the USA has been standing in the gap for the rest of the world for 60+ years. It's well past time for some other nations to start playing "lets save the world" so we can take a break while we deal with internal issues. So what nation will take over world police action while American has a revolution?

Anyone? *taptaptap - this thing even on?*

*waves arm* Canada was food rescue and shelter for the past 30years.
"TEAM AMERICA, WORLD POLICE" Was a freaking great movie.
But really, To "pat america on the bat", Who else could act like world police in the way that they do, With as little resistance that they get.
Lol imagine if China or Russia tried to play World Police. The earth would freak the fuck out!
But america does it, And we can relax... Kinda.
Good job Uncle Sam...
Fuck You Big Brother.

Its economics. Its based on unlimited demand and limited supply. When there is a huge discrepancy between the two of these, the item (like gold) is very expensive.

To be fair, it's not that they "work together" -- it's that the government threatens your employer with punishment (caging, bankruptcy, aggressive violence if necessary).  I wouldn't qualify that as "working together" any more than I would qualify a rapist and his victim as "making love".

As one of my favorite philosopher says: the institution named "State" survives, only because people willfully pretend that the gun in the room isn't there.

I'm sure people have already said this in the comments but you can pay off your credit card with it. All you would do is trade it to someone who thinks it's worth $11 and give that to your credit card company or bank.

It's like saying you can't pay off your credit card with Japanese Yen and asking why people value 79.5 Yen as 1USD. It's a currency used by people somewhere else and it's value fluctuates based on the two markets. It's as simple as that.