Bitcoin Forum

This is my first post here, so hello everyone. I'm supposed to write five newbie posts to be able to participate in the forums, so I thought I'll use that to share some thoughts, instead of simply writing five quick and meaningless replies to some threads just to hit the limit.

I believe Bitcoin isn't in a bubble. It's during its long period of growth as it's getting acknowledged by more and more businesses and individuals, transforming it into widespread and recognized currency.

Most of other cryptocurrencies though, that's a real bubble. People are getting crazy about any new cryptocurrency someone introduces. They spend their dollars, bitcoins and computing power on new ecosystems which don't provide any other value than, well, being new. I kinda understand it. I jumped the Bitcoin bandwagon pretty late too and I understand the urge to participate in the next thing that costs $0.001 today but can grow to hundreds of dollars one day. Except it's not going to happen.

Now, some alternate cryptocurrencies have that potential. I am not that blind Bitcoin believer, so I expect one day it might be replaced with some other cryptocurrency that will evolve from it. That is entirely possible and it would be naive to think that Bitcoin is not only the first, but also the last popular cryptocurrency the world will use. Things that are first, rarely turn out being the last in this world.

But I can't see any reason why that should happen to a currency that is nothing but a clone of some other currency.

Now, I like and support all the currencies that are evolving from Bitcoin and are changing something significant in the protocol. It's in the benefit of the entire cryptocurrency ecosystem to evolve. I like Litecoin as the use of scrypt makes it a bit impractical to mine by ASIC, what might lead to better decentralization. I like PPCoin for its hybrid proof-of-stake/proof-of-work system. These are useful experiments and that kind of experiments might lead eventually to a new currency which will compete with Bitcoin. And that's really healthy.

But most of alternate currencies are like “we are like [somecoin] except that we will create two times more of [ourcoins] in total. Ha!”. There's no value in that. If there's not even a slightest innovation involved, there's no way that this new [ourcoin] will succeed and exceed the network effect which existing [somecoin] already has.

But these currencies attract people and there are already thousands of dollars invested in them. Like Feathercoin, which is only one week old, provides no innovation at all, and to my understanding it already has 4.254M coins created (21268 blocks as of now * 200 coins), which people are trading at 15 LTC ~ 1k FC. That makes FC capitalization at around $165,000.00 and growing rather exponentially every day.

This is the real bubble and all these cloned currencies are in my opinion pump and dump schemes. Now, there's nothing wrong to get involved now and sell with some profit before these currencies die - if that's what you're interested. But please be aware of that scheme and don't expect them to be the next big thing.

Or is there someone who truly believes in cloned currencies and wants to convince me I'm wrong? Discuss. Thanks.

+1

By using scrypt as their hasing algorithm, albeit choosing odd parameters for it, LTC really did some innovation there. I'm not sure about PPC, I dont buy into that whole proof of stake thing.
Personally, i'd like to see a cryptocurrency introducing a "tax" on coin hoarding, to keep the money flowing thus driving the economy

Great first post and my sentiments exactly. It seems to me that the Feathercoins of this world only exist solely to justify mining. They are pointless and an unnessesary expense of electricity, effort and cost, IMHO

Yes. Altcoins need to establish themselves more in terms of sensible economics than better/worse optimized mining features.

I'd like to see inflation target brought to its full potential like PPC is trying to introduce.

In essence, Bitcoin NEEDS other competing crypto currencies to survive as a fair market game changer, but you over complicate the notion of a bubble.

There was very much a bubble formed the last couple of months as unsophisticated speculators were awakened to crypto currencies by the mainstream media explosion...(none of which incidentally undertook even the most trivial of journalistic integrity by reading the 8-page white paper)

That did pop, and now we have had a volatile state of correction undermined by genuine value. For now I believe and did during the last couple of months the average price should be around US $100. It's a milestone figure that is acknowledged by all.

I also feel there will and correctly should be a fall in price as the ASIC miners dilute the market with newly minted coins, but then WTFDIK...;)

What bitcoin needs now more than ever is less volatility and greater payment acceptance by retailers willing to accept it as a payment and be rewarded with minimal transaction fees associated with fiat payments.

Freicoin (http://freicoin.org/)

Agreed. FeatherCoin is bubble. I see no value in it too. UselessCoin 

Oh wow. I didnt look into Freicoin because i didnt like the name. thanks!

Really good first post.

I agree Bitcoin certainly isn't a bubble, nor is Litcoin, I'm sure a few of the other CC's are just in it to make a quick buck, But you always get a few rogues jumping on the band wagon.

Welcome to the forum! Looks like you have a good understanding of bitcoin and some of its alts already. I totally agree that there are far too many alternative cryptocurrencies being created right now, many of which offer very little innovation and are little more than pump and dumps. There has been an alt coin boom this year, and it has gone a little bit overboard with a new alt being created almost every day now. While some may worry that this proliferation of alts will suck value out of bitcoin, I am more inclined to believe that most will simply fall flat on their face and die within a few weeks or months of launch. The few that survive will do so because they contain truly useful and innovative features.

iv been thinking of investing in litecoin, anyone else had this thought?

I'm wondering, can any of these crypto currencies overcome the volatility inherent in a rigid money supply? When this is the case for a mass-use currency it has many macroeconmic consequences that were the reason for moving toward a fiat system.
Any thoughts on whether crypto currencies are forever destined to be "on the side" or can they function as mainstream currencies?
 

I'm not sure about that idea either, but I'm sure it's good that someone is testing it. Even if it'll turn out to be a bad idea, we need many bad ideas tested and failed for each great one found.


It's an interesting concept, but I have no idea why anyone would like to use such a currency if there were alternatives that are not taxing savings? Every second you keep that currency you loses value, why would you want to do that?


Why would ASIC miners dilute the market? There won't be more coins generated because of increased total network hash rate, as difficulty will increase to compensate for that and keep number of generated coins at the same level. It'll be just much less coins mined per GH/s as unchanged number of new coins will divide into much bigger hashrate. As coins will be more expensive to mine, their value should increase.


Everyone: thanks for the welcome!

Thank you for your post I can see it is well intention-ed however you've highly underestimated the need for cryptocurrencies.

Cryptocurrencies bitcoins=litecoins=feathercoins all are tied to the freemarket enterprise that is being driven by the internet.
In the same sense that everyone wants to come to America because the same free-market principles led to 200 years of prosperity; those same people would have to exchange value for equivalent purchasing power (USD) to be able to trade/barter/purchase within the free-market (we used to have here in the states). In the same sense, the internet is the new free market, and this currency is tied too it.

Bitcoin is a bubble that will swap to an other currency when it will become too difficult to mine ...

Sigh. scrypt proof-of-work was introduced by tenebrix and done by ArtForz, the 'odd parameter' was also chosen by ArtForz. litecoin did nothing to innovate, it only copied from others, without even attempting to change the 'odd parameter'. I don't mind people being a fan of litecoin but at least get your facts straight.


There is already such a coin called freicoin.

Hmm... thnks,

 :)

Same toughts that I have. I mean , where are all these alt-cryptocurrency used? There are website who accepts them?Other than just cryptsy or coinedup?I don't find for them a real usage. They are useless if they are too much.

Everyone wants to go to America? Free-market principles led to 200 years of prosperity?

Not worth arguing...

Some damn good posts I think :)

I am far from an expert - but I know what I *think* my game plan is - first of all to do my first five posts as a newbie so I can then participate fully in the forums here/etc... :)

But - my overall game plan ? To be holding btc long term - I truly believe that once all the stuff going on at the moment - the ''pump and dumps'' - the whales trying to push btc down to nothing in value and then clean up - all the market manipulation and so on - after THAT, I still believe Bitcoin will find its level and that that level will continue to RISE - it *has* intrinsic value whatever greenspan or bernenke or whoever it was said a while back about it not :)

Its technology itself and its function - to me its an economic revolution - and if it keeps on going the way it is (and I think it will) it could also be the death of banks and banksters - or at least as we know them - and that would be a VERY GOOD thing :)

Just my two cents worth :)